WASHINGTON – Rep. Chris Van Hollen, D-Md., unveiled his “action plan” to address income inequality on Monday, which aims to tackle uneven wealth distribution through tax reform and is backed by senior Democrats.
The centerpiece of Van Hollen’s pitch, which he announced at the Center for New American Progress, is a tax credit that would cut $2,000 a year off tax bills for two-earner households earning less than $200,000, which he said would raise a typical worker’s income by $40,000. The proposal also includes a provision to limit big corporations’ claims to tax breaks without paycheck increases for employees.
The plan advocates a much stronger stance than President Barack Obama and Democratic leaders took last year, indicating a Democratic push to combat GOP tax breaks.
“The tired Republican mantra of cutting tax breaks for the wealthy will only make this problem worse,” Van Hollen said in his speech, noting compensation for the richest Americans have been increasing, while paychecks for middle-class workers have remained stagnant.
Income inequality is making headlines for shattering records established during the “Roaring Twenties,” with more than 20 percent of before-tax income flowing to the richest one percent of households, according to the analysis by the Center on Budget and Policy Priorities of Congressional Budget Office data. Van Hollen emphasized that although the economy is improving, the middle class is falling behind.
“If you want a growing pie for all, you need a pie where everyone can get a bigger slice,” Van Hollen said.
Van Hollen said he will introduce the provision about big corporation tax deductions, called the CEO-Employee Paycheck Fairness Act, within 10 days. The rest, he said, will come “over a period of time.”
House Minority Leader Nancy Pelosi, D-Calif., is among those who have endorsed the proposal, according to the Washington Post. But with Republicans in control of Congress, the plan may face harsh opposition.
Van Hollen said he is “not surprised” by Republicans on Capitol Hill, adding, “We wanted to kick off the debate.”