Cardin: ‘Do No Harm’ in Tax Reform

Kicking off the first day of the 5th annual NAPA DC Fly-In Forum July 18, Senate Finance Committee member Ben Cardin (D-MD) expressed his unwavering support for the current tax incentives for retirement savings, noting that a fundamental point for him on tax reform will be to first “do no harm.”

Cardin, who has long been an ardent supporter of retirement savings initiatives, shared with Fly-In delegates his unique insight on the current tax reform debate taking place in Washington. Cardin also expressed his appreciation for the strong advocacy work that NAPA and the ARA does on behalf of the retirement savings industry. He also emphasized how important it is for NAPA representatives to be in Washington, DC to speak with lawmakers on a first-hand basis, noting that it makes a real difference to meet real people who work in the industry.

Addressing the current tax reform debate, Cardin told attendees that, “We don’t want to compromise on any of the current tools that we have available for retirement security. We think they are critically important to maintain or to substitute with stronger incentives, but we don’t want to weaken the incentives in current law.”

He added that the forthcoming debate will not be an easy fight in an environment where lawmakers will be looking for revenue raisers in order to move forward on revenue-neutral tax reform.

Cardin also emphasized how there continues to be a retirement savings crisis, with most Americans  still not saving enough, and that policymakers need to make sure the “three-legged stool” of retirement savings stays strong. He suggested building on what works with the current system and looking at how policymakers can help strengthen and encourage more employer-sponsored plans. Coming back to the “do no harm” principle, he warned against proposals that may very well be meritorious, but may also jeopardize the employer-sponsored system.


Read our other coverage of this year’s Fly-In here and here.


Cardin noted that it’s a powerful incentive to get individuals participating in a plan when employers “put money on the table,” as part of a two-pronged approach of using a financial incentive and the tax deferral to get more workers engaged. He also suggested building on the success of auto enrollment, explaining that it has been a great success in getting younger and more moderate income workers participating in balanced funds. Financial literacy is another topical area that Cardin believes has seen great advancements that he would like to see continue.

With respect to the fiduciary rule, Cardin explained that he is aware of the ongoing controversy surrounding the rule and that he is absolutely committed to making sure people have access to sound investment advice under a best interest standard, but added that there needs to be a clearer way of dealing with the practical aspects of the way investment advice is handled in today’s market.

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