H.R.684 - Protecting American Savers and Retirees Act (119th Congress)
Summary
H.R. 684, the "Protecting American Savers and Retirees Act," proposes to repeal the excise tax on the repurchase of corporate stock. This bill amends the Internal Revenue Code of 1986 by repealing Chapter 37, which currently imposes this tax. The amendment would apply to taxable years beginning after December 31, 2024.
Expected Effects
The repeal of the excise tax on stock buybacks would primarily benefit corporations by reducing their tax burden. This could lead to increased stock buyback activity. The intended effect is to encourage investment and potentially boost stock prices.
Potential Benefits
- Potentially increased investment in companies due to reduced tax burden.
- Possible increase in stock prices, benefiting shareholders.
- Reduced compliance costs for corporations related to the excise tax.
- May encourage companies to allocate capital to other areas, such as R&D or expansion.
- Simplification of the tax code by removing a specific excise tax.
Most Benefited Areas:
Potential Disadvantages
- Potential reduction in government revenue, which could impact public services.
- May incentivize stock buybacks over other forms of investment, such as employee wages or capital improvements.
- Could exacerbate income inequality if the benefits disproportionately accrue to wealthy shareholders and corporate executives.
- The repeal could be viewed as a tax break for large corporations, leading to public criticism.
- Potential for increased corporate debt if buybacks are financed through borrowing.
Most Disadvantaged Areas:
Constitutional Alignment
The bill falls under the purview of Congress's power to lay and collect taxes, duties, imposts, and excises, as outlined in Article I, Section 8, Clause 1 of the Constitution. The Constitution grants Congress broad authority over taxation. The repeal of a tax is also within this power.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).