Coburn Takes a Look at Tax Expenditures

Senator Tom Coburn (R-OK) has released a new list of ten wasteful tax expenditures, totaling $130 billion over the next ten years. Whether it is tax breaks for NASCAR tracks, fishing tackle boxes, or films produced in the U.S., the list serves as a clear sign that there are plenty of places to look to raise revenue from tax expenditures. Coburn's list is below.

Coburn's Top Ten Tax Expenditures
Policy Deficit Reduction
Eliminate Tax Breaks for Millionaires  $100 billion
Eliminate the Professional Sports Loophole  $910 million
End New Markets Tax Credit  $7.4 billion
End Tackle Box Tax Break  $11 million
End Dog and Pony Show Tax Break  $30 million
End Hollywood Tax Break  $300 million
End NASCAR Tax Break  $400 million
End Tree Planting Subsidies  $2 billion
End Historic Preservation and Non-Historic Structures Break  $7.6 billion
End the Residential Energy Efficient Tax Credit  $12 billion
Total Savings  $130 billion

Source: Senator Tom Coburn

Savings of $130 billion is not enough to close our deficit, but it does reinforce that we need to take a serious look at reforming the tax code to make sure the credits and deductions we do have reflect good policy. A simpler tax code with a broader base could raise revenues and lower rates, while being as or more progressive than today's tax code. A simpler code would also help the IRS reduce our tax gap for additional savings.

On a similar note, Senator Coburn also recently sent a letter to the President and Congressional leaders urging them to let many expiring tax breaks sunset, saving $18 billion next year alone (note: a few of the policies mentioned in the letter overlap with the tax expenditures mentioned above). It's worth taking a serious look at these extenders, some of which may be justified and should be made permanent while are not justified and should expire. Looking at these tax extenders and tax expenditures as a whole should certainly be a central part of efforts to raise revenue during the fiscal cliff negotiations.