NRF asks Super Committee to focus on economy & job creation
With a congressional “super committee” on deficit reduction set to begin work this week, the National Retail Federation sent a letter to committee members urging the panel to focus on initiatives that will boost the economy and create jobs.
“While we realize that the basic mandate of the committee is to bring revenue and spending into balance, we urge members to have a broad outlook when considering the options for achieving that goal,” NRF Senior Vice President for Government Relations David French said in the letter. “We firmly believe that policies that encourage job creation and economic growth are the ultimate answer to deficit reduction – more jobs means more Americans earning a paycheck and more paychecks mean more tax revenue coming into the Treasury. Putting Americans back to work can let us work our way out of the deficit without the need for draconian cuts in essential services or punitive increases in taxes that are already too high.”
“The creation of this panel is a unique opportunity to look at the big picture of policies that affect our nation's economy – not just government spending and the tax code but rules and regulations that have a clear impact even if their price tags are usually kept hidden,” French said.
The Joint Select Committee on Deficit Reduction is scheduled to hold its first meeting on Thursday. Created under legislation signed into law last month to increase the federal debt ceiling and made up of equal numbers of Democrats and Republicans from the House and Senate, the 12-member panel has until November 23 to recommend $1.5 trillion in deficit reduction to be implemented over the next 10 years.
In letter, NRF encouraged the committee to include three key initiatives among the options it considers:
Corporate tax reform that would “broaden the base” by eliminating special tax breaks enjoyed by a handful of industries in return for lower corporate rates for all. The intensely competitive retail industry would pass most of the tax savings along to consumers in the form of lower prices, thereby increasing demand for products and increasing employment not only in the retail industry but among the industries that supply merchandise and services to retailers. Proposals for a Value Added Tax or other consumption tax should be rejected. An Ernst & Young study conducted for NRF last year found that adding a VAT to the current tax system in order to reduce the deficit would cause the loss of 850,000 jobs in the first year alone, reduce GDP for three years and reduce retail spending by $2.5 trillion over the first 10 years.
The Main Street Fairness Act, which would make it easier for states to require out-of-state Internet retailers to collect sales tax on sales to their residents. The legislation would end an unfair tax advantage held by online retailers over Main Street stores, which are struggling to keep their doors open and to continue providing employment in local communities across the country. Doing so would cost the federal government nothing, but would allow cash-strapped state and local governments to collect a tax already owed by consumers and provide revenue needed to support the jobs of essential workers such as firefighters, ambulance crews, police officers and teachers. Such a move is particularly important at a time when the committee may be considering cuts in federal aid to the states.