RALEIGH—Rep. Heath Shuler (D-Waynesville) said Friday he won’t support a bill being considered in the House and already passed by the Senate that would prevent more than 66,000 Western North Carolina taxpayers from being forced to pay the alternative minimum tax next year.  Congress created the AMT in 1969 amidst concerns that extremely wealthy families were avoiding income taxes by claiming extensive deductions.  The tax was originally aimed at the wealthiest families in the country.  Its purpose was to ensure that these families were forced to pay at least a minimum amount of taxes each year.  However, the AMT was not indexed for inflation, so as incomes have increased since 1969, more Americans have reached the income eligibility level for the AMT thereby forcing them to pay the tax.  In 1970, 20,000 taxpayers were subjected to the AMT.  Last year, about 4 million taxpayers were forced to pay the tax.  If a fix is not enacted before next year, the AMT could reach as many as 25 million taxpayers nationwide, some with incomes as low as $50,000. 

Shuler claims his opposition to the AMT fix is based on his “firm commitment to (pay-as-you-go) budgeting.”  Shuler maintains that any new federal program or tax cut must be offset with new revenues to avoid adding to the federal budget deficit.  However, the AMT fix is not a new program or a tax cut as it only intends to keep taxpayers from being affected by the tax that were never the intended targets of the AMT.  Also, Shuler has not been as committed to “paygo” when Democrats were proposing expanding government programs.

“In fact, the paygo farce has been unfolding all year. Since the day they took the gavel, Democrats have been using gimmick after gimmick to evade it. The Schip bill for health care, for example, includes a spending ‘cliff’ that disguises its actual cost. It assumes spending would rise to $14 billion in 2012, but then pretends the costs would fall to less than half that level in 2013--which just so happens to fall outside the five-year budget scoring window. Some $60 billion in spending over the next 10 years were hidden through this ploy.

Then there is the House farm bill awaiting action in the Senate. That spending marathon includes between $5 billion and $10 billion in fictitious paygo savings by shifting the date of farm aid payments from one year to another. If a Fortune 500 CEO did that sort of thing, he'd be indicted.” 

(“The Paygo Farce” The Wall Street Journal, December 10, 2007 http://www.opinionjournal.com/editorial/feature.html?id=110010970)

If Heath Shuler is so opposed to deficit spending, why did he not stand up to Democrats when they proposed such programs this year?

Chairman Linda Daves, North Carolina Republican Party, made the following statement:

“Heath Shuler should not pretend to be standing by his ‘principles’ when it is clear his only loyalty is to Democrats in Washington and their liberal spending policies.  Shuler’s claim that the revenue generated by the alternative minimum tax must be replaced is a farce.  The AMT was never intended to generate such large revenue just as it was never intended to affect hard-working, middle-class Americans.  It is time to face pay-as-you go for what it is: a liberal plan to make tax cuts impossible and justify tax hikes for more big government greed and lavish spending.  Shuler claims to be a Blue Dog, but on the AMT fix he proves himself to be a liberal lap dog.  Western North Carolina deserves better representation in Congress.”