Section 1 Short title
This Act may be cited as the “Making Work and Marriage Pay Act of 2013”.
Making Work and Marriage Pay Act of 2013
A BILL
To establish the National Commission on Effective Marginal Tax Rates for Low-Income Families.
Sec. 2 Findings
Congress finds the following:
The take-home pay of low-income families is subject to reductions from many sources, including the Federal income tax, Social Security payroll taxes, and State income taxes. In addition, eligibility for many Federal and State programs for assistance to working families, such as the earned income tax credit, the child tax credit, supplemental nutritional assistance program, housing assistance programs, Federal and State health care programs, child care assistance, and temporary assistance to needy families, is based in part on income levels. The rates at which the benefits from such programs are phased out have the same disposable income reducing effect as escalating marginal tax rates.
The total effective marginal rate of tax for additional income earned by low-income people can exceed 100 percent and can be a disincentive to working more hours, getting a raise, seeking education toward a more lucrative trade, getting married, or engaging in other economic or social activities.
Congress has enacted each of these programs without full consideration of the impact it would have on other existing programs. As a result, the structure of the United States system for the support of low-income families is uncoordinated and contains features which work against the goal of encouraging families to work their way toward self-sufficiency.
Sec. 3 Definitions
For purposes of this Act:
Low-income— The term low-income means, with respect to any individual or family group, an individual or family group, as the case may be, whose income is not more than 225 percent of the poverty line (as determined under section 673(2) of the Community Services Block Grant Act (42 U.S.C. 9902(2))).
Federal benefits— The term Federal benefits means—
deductions, credits, and other tax benefits available to low-income taxpayers under the Internal Revenue Code of 1986, including—
the earned income tax credit under section 32 of such Code,
the child tax credit under section 24 of such Code, and
the dependent care tax credit under section 21 of such Code, and
Federal assistance programs for low-income individuals and families, including—
the supplemental nutritional assistance program established under the Food and Nutrition Act of 2008 (7 U.S.C. 2011 et seq.),
any assistance, loan, loan guarantee, housing, housing assistance, or other housing related program administered, in whole or in part, by the Secretary of Housing and Urban Development, the Secretary of Veterans Affairs, or any other Federal agency housing assistance, including the project-based and tenant-based rental assistance programs under section 8 of the United States Housing Act of 1937,
any Federal programs providing child care assistance, and
Federal programs providing health care assistance, including assistance under the Medicaid program established under title XIX of the Social Security Act, the State Children’s Health Insurance Program under title XXI of such Act, and the Patient Protection and Affordable Care Act.
Effective marginal tax rate— The term effective marginal tax rate means the cost, in terms of both taxes and loss of Federal benefits, for each dollar earned by a low-income individual.
Sec. 4 National Commission on Effective Marginal Tax Rates for Low-Income Families
Establishment— There is established a commission to be known as the “National Commission on Effective Marginal Tax Rates for Low-Income Families” (hereinafter in this Act referred to as the “Commission”).
Duties of commission—
In general— The Commission shall study and make recommendations on policy changes to mitigate the impact of the effective marginal tax rate and of phaseouts in Federal benefits on low-income earners and their families.
Report— Not later than 18 months after the first meeting of the Commission, the Commission shall submit to the President and to the Chairman and Ranking member of each Committee of the House and the Senate that has legislative jurisdiction over any of the Federal programs or revenue policies addressed therein, a report containing the following:
Analysis— A detailed analysis of the following:
The Commission’s general recommendations for increasing coordination of the delivery of Federal benefits for low-income families in order to reduce effective marginal tax rates and decrease disincentives to work and marriage.
The relative usefulness of sudden benefit cutoffs (sometime referred to as “cliffs”) versus gradual reductions (sometime referred to as “phaseouts”) in Federal benefits on low-income workers’ behavior relating to work and marriage.
The interaction of Federal benefits and State assistance programs, and the potential benefits of structuring State programs consistent with the design of Federal assistance.
The maximum extent to which funding for Federal benefits can be appropriated annually avoiding the need to create additional entitlement programs.
The extent to which low-income cohabiting couples (including couples with children and couples without children) resist entering a legal marriage in order to maximize Federal benefits and avoid lost income.
Recommendations—
In general— A description of the Commission’s recommendations relating to the following:
Combining all Federal benefits which are not tax benefits into a single flexible voucher, allowing the beneficiary to allocate funds within each of the supported benefit areas.
To the extent possible, providing all eligible families with equal voucher funds described in subclause (I), varying only for income, family size, and the presence of children in the household.
Combining all Federal benefits which are tax benefits for low-income families into a coordinated credit that minimizes phaseouts, encourages work, is adjusted for family size, and does not penalize marriage.
Establishing a single eligibility standard for all Federal benefits.
Revenue neutrality— In making recommendations under this subparagraph, the Commission shall consider the need to maintain revenue neutrality in order to avoid increasing the deficit.
Blueprint for legislation— The Commission shall provide a blueprint for legislative proposals for each policy recommendation under this subparagraph.
Other matters—
Non-feasibility— Should the Commission conclude that the policy framework described in subparagraph (B) is not feasible, the Commission shall include in its report—
a detailed analysis of such policy framework,
a comprehensive explanation of the reasons for its conclusion, and
one or more policy recommendations addressing the problem of effective marginal tax rates on low-income families.
Additional matter— If the Commission includes in its report a policy plan using the policy elements described in subparagraph (B), it may also include additional alternative recommendations (together with a legislative blueprint as provided under subparagraph (B)(iii)).
Membership and meetings—
Members— The Commission shall be composed of 15 members, of whom 4 shall be members described in paragraph (2) and 11 shall be appointed pursuant to paragraph (3).
Cabinet members serving on Commission—
In general— The members described in this paragraph are the following Secretaries:
The Secretary of the Treasury.
The Secretary of Agriculture.
The Secretary of Housing and Urban Development.
The Secretary of Health and Human Services.
Non-voting members; chairman— Of the members of the Commission described in subparagraph (A)—
the 2 members with the least seniority in terms of service as Secretary shall be nonvoting members,
the member with the most seniority in terms of service as Secretary shall be the chairman, and
in the event that the head of a cabinet department serving as a member of this Commission under subparagraph (A) is replaced, and that Cabinet Secretary was serving as a voting member of the Commission or as the Chairman of the Commission, the incoming Secretary shall assume such a role on the Commission without regard to the seniority criteria established under this subparagraph.
Appointed members—
Congressional appointments— The Speaker of the House of Representatives, the minority leader of the House of Representatives, the majority leader of the Senate, and the minority leader of the Senate shall each appoint 2 members, who shall each be experts in the subject matter of the Commission.
Governors—
In general— The President shall appoint 3 State governors, of whom—
no more than 1 shall represent the same political party represented by the President,
1 shall be a governor of a State which is ranked in the top third on the list of benefit providers established under clause (ii),
1 shall be a governor of a State which is ranked in the middle third on the list of benefit providers established under clause (ii), and
at least 1 shall be a governor of a State which is ranked in the lowest third on the list of benefit providers established under clause (ii).
Ranking of States— The members of the Commission described in paragraph (2)(A) shall establish a list ranking of States from highest benefit providers to lowest benefit providers based on the following:
The level of benefits provided in the State under the Temporary Assistance to Needy Families under title IV of the Social Security Act.
The average fair-market value of rental housing in the State.
The State share of assistance provided under a State plan under the Medicaid program under title XIX of the Social Security Act and a State child health plan under the State Children's Health Insurance Program under title XXI of such Act.
Date for original appointment— The appointing authorities described in paragraph (1) shall appoint the initial members of the Commission not later than 30 days after the date of enactment of this Act.
Terms of appointment— The term of any appointment shall be for the life of the Commission.
Designees— A member of the Commission serving under paragraph (2), appointed under paragraph (2)(B), or appointed under paragraph (3) may appoint a designee to serve on the Commission in such member’s place.
Meetings— The chairman shall call the first meeting of the Commission. Thereafter, the Commission shall meet at the call of its chairman or a majority of its members.
Quorum— A quorum shall consist of 9 voting members of the Commission.
Vacancies— A vacancy on the Commission shall be filled in the same manner in which the original appointment was made, not later than 30 days after the Commission is given notice of the vacancy, and shall not affect the power of the remaining members to execute the duties of the Commission.
Compensation— Members of the Commission shall receive no additional pay, allowances, or benefits by reason of their service on the Commission.
Expenses— Each member of the Commission shall receive travel expenses and per diem in lieu of subsistence in accordance with sections 5702 and 5703 of title 5, United States Code.
Commission staff—
Appointment and compensation— The chairman, in accordance with rules agreed upon by the Commission, may appoint and fix the compensation of a staff director and such other personnel as may be necessary to enable the Commission to carry out its functions, without regard to the provisions of title 5, United States Code, governing appointments in the competitive service, and without regard to the provisions of chapter 51 and subchapter III of chapter 53 of such title relating to classification and General Schedule pay rates, except that no rate of pay fixed under this subsection may exceed the equivalent of that payable for a position at level V of the Executive Schedule under section 5316 of title 5, United States Code.
Personnel as federal employees—
In general— The executive director and any personnel of the Commission who are employees shall be employees under section 2105 of title 5, United States Code, for purposes of chapters 63, 81, 83, 84, 85, 87, 89, and 90 of that title.
Members of commission— Subparagraph (A) shall not be construed to apply to members of the Commission.
Detailees— Any Federal Government employee detailed to the Commission shall retain the rights, status, and privileges of his or her regular employment without interruption.
Expert and consultant services— The Commission is authorized to procure the services of experts and consultants in accordance with section 3109 of title 5, United States Code, but at rates not to exceed the daily rate paid a person occupying a position at level IV of the Executive Schedule under section 5315 of title 5, United States Code.
Volunteer services— Notwithstanding section 1342 of title 31, United States Code, the Commission may accept and use voluntary and uncompensated services as the Commission determines necessary.
Powers of commission—
Hearings and other activities— For the purpose of carrying out its duties, the Commission may hold such hearings and undertake such other activities as the Commission determines to be necessary to carry out its duties.
Detail of Federal employees— Upon the request of the Commission, the head of any Federal agency is authorized to detail, on a reimbursable basis, any of the personnel of such agency to the Commission to assist the Commission in carrying out its duties. Any such detail shall not interrupt or otherwise affect the civil service status or privileges of the Federal employee.
Contracting— The Commission may, to such extent and in such amounts as are provided in appropriation Acts, enter into contracts to enable the Commission to discharge its duties under this title.
Technical assistance— Upon the request of the Commission, the head of a Federal agency shall provide such technical assistance to the Commission as the Commission determines to be necessary to carry out its duties.
Use of mails— The Commission may use the United States mails in the same manner and under the same conditions as Federal agencies and shall, for purposes of the frank, be considered a commission of Congress as described in section 3215 of title 39, United States Code.
Information from federal agencies—
In general— The Commission is authorized to secure directly from any executive department, bureau, agency, board, commission, office, independent establishment, or instrumentality of the government, information, suggestions, estimates, and statistics for the purposes of this title. Each department, bureau, agency, board, commission, office, independent establishment, or instrumentality shall, to the extent authorized by law, furnish such information, suggestions, estimates, and statistics directly to the Commission, upon request made by the chairman, the chairman of any subcommittee created by a majority of the Commission, or any member designated by a majority of the Commission.
Receipt, handling, storage, and dissemination— Information shall only be received, handled, stored, and disseminated by members of the Commission and its staff consistent with all applicable statutes, regulations, and Executive orders.
Administrative support services— Upon the request of the Commission, the Administrator of General Services shall provide to the Commission on a reimbursable basis such administrative support services as the Commission may request.
Printing— For purposes of costs relating to printing and binding, including the cost of personnel detailed from the Government Printing Office, the Commission shall be deemed to be a committee of the Congress.
Termination— The Commission shall terminate 30 days after the date of submission of the report required in subsection (b).
Limitations on authorization of appropriations— There are authorized to be appropriated $1,500,000 to carry out this section. Any amount appropriated pursuant to the authority of this subsection shall remain available without fiscal year limitation until expended.