Is it time to reform the Tax Code?

All this talk about cutting “tax expenditures” got me a thinking. If the President has decided that now itemized deductions must go to help him cut the deficit, maybe it’s time we just chuck the entire tax code. The man behind the Laffer curve thinks so. Can you say 12%?

Art Laffer, a member of Reagan’s economic team and the man who designed the Laffer curve which simply states that as tax rates go down, revenues increase, told Neil Cavuto yesterday that the time has come to reform the tax code. Yes, eliminate deductions (but not the mortgage or charitable deduction, Mr President) and flatten the tax. No forms necessary.

httpv://www.youtube.com/watch?v=LUfPlPNCB9U

Given that this proposal saves the cherished mortgage and charitable deductions, my guess is it might have a chance, with a new President.

 

14 replies
  1. Dimsdale
    Dimsdale says:

    Flat tax baby!!  It is fair in the truest sense of the word, and still redistributive, so the lefties should be satisfied.  Billions saved in wasted tax prep time, hiring of tax "experts" and paper.

  2. GdavidH
    GdavidH says:

    Why do you people hate tax experts and capitalism so much? You really want all your park benches inhabited by unemployed H&R Block folks?

    Oh the humanity!

  3. Tim-in-Alabama
    Tim-in-Alabama says:

    Flat tax with no deductions, and everyone pays – even Obama supporters and cabinet members. The government should stop using the tax code to encourage (or discourage) behavior.

  4. Plainvillian
    Plainvillian says:

    The flat tax on income is ideal as long as all income is legal.  For those working "off the books" or involved in illegal enterprises (drugs etc.) some form of consumption tax would need to be in place.  A flat income tax at a slightly lower rate and a low consumption tax on everything but food and other necessities would be equitable and even Tim Geitner could comply.

    • Dimsdale
      Dimsdale says:

      Every time money moves, it is taxed by someone.  "Off the books" money just gets taxed a bit less.

       

      A consumption tax, in the hands of the pols, will simply expand out of control just like the current system.   We have to take as much of this power away from the vote buying pols as we can.

  5. joe_m
    joe_m says:

    The flat tax is the way to go but we need some control to keep it from growing.

    Either a 2/3 majority of congress for an increase or better, a requirement that a 2/3's majority approve any increase in a general election.

    I do not trust congress to control themselves when it comes to spending "other peoples" money

  6. Gary J
    Gary J says:

    No matter what idea pops up with the tax code,someone is going to gripe. Someday <maybe>our elected reps. will see it's the spending and nothing more that is the problem. In reality it is no different than any household or business. What happens when spending exceeds income? Bankrupt!

  7. BEA
    BEA says:

    Saw an interesting fact on Fox this am…In 1913 there were a mere 400 pgs to the US Tax Code and in 2010 there were over 70,000 pgs. My husband is a CPA and tries to keep up with all the updates…so many loopholes, twists and turns…I swear sometimes his head spins!

  8. Lynn
    Lynn says:

    I'm all for flat tax.  The tax attorneys and CPAs can earn a little less of small businesses and average Joe's/Jane's hard earned money.  I can't wait to strip the IRS to its bare bones. Go Laffer!

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