Progressive Consumption Tax Act of 2020

Progressive Consumption Tax Act of 2020

This bill revises the federal income tax system by, among other things, imposing a 10% consumption tax on specified supply items, including (1) the sale or provision of property; (2) the performance of services; (3) the grant, assignment, or surrender of real property; (4) the creation, grant, transfer, assignment, or surrender of any right; (5) financial supplies; and (6) entry into, or release from, an obligation or agreement to perform or refrain from performing an act. The bill specifies certain exempt supplies to which the tax does not apply.

The bill reduces to three the number of brackets for the individual income tax and reduces the income tax rate to a maximum level of 28%. It treats long-term capital gains and dividends as ordinary income.

It also provides for a family allowance based on filing status.

The bill repeals limitations on certain itemized tax deductions and restores previously repealed tax deductions, including the deductions for state and local taxes and personal casualty losses. It eliminates the alternative minimum tax.

The bill reduces the corporate income tax rate to 17%.