Bills of Congress July 2, 2025 by U.S. Congress

Bipartisan Tax Fairness Act of 2025

Summary

The Bipartisan Tax Fairness Act of 2025 proposes changes to the Internal Revenue Code of 1986, primarily focusing on income tax rates. It aims to make permanent certain expiring tax rates and introduce a new top income tax rate. The bill outlines revised tax brackets for various filing statuses, including married individuals filing jointly, heads of households, and single individuals.

Expected Effects

The Act would alter the amount of taxes paid by individuals and families across different income levels. Higher-income earners would likely see changes due to the new top tax rate. The changes are set to take effect for taxable years beginning after December 31, 2025.

Potential Benefits

Potentially increased government revenue from higher earners.
Possible simplification of the tax code by making certain rates permanent.
May provide more predictable tax liabilities for individuals and businesses.
Could lead to increased investment in public services if revenues increase.
The bill has bipartisan support, which could lead to more stable tax policy.

Potential Disadvantages

Potential for increased tax burden on higher-income earners, which could disincentivize investment.
Possible economic distortions due to altered tax incentives.
Complexity in adjusting to new tax brackets and rates.
Risk of reduced economic activity if higher taxes negatively impact businesses.
The changes could disproportionately affect certain demographic groups.

Constitutional Alignment

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The bill aligns with the constitutional power granted to Congress in Article I, Section 8, Clause 1, which provides the power to lay and collect taxes. The Sixteenth Amendment allows Congress to levy an income tax without apportionment among the states. The bill's provisions must adhere to the principles of equal protection and due process as outlined in the Fifth and Fourteenth Amendments.