Panel to Review U.S. Tax Code

Los Angeles Times ^ | February 16, 2005 | Warren Vieth, Times Staff Writer

[ancient_geezer]

Panel to Review U.S. Tax Code

By Warren Vieth, Times Staff Writer
WASHINGTON — A presidential commission today launched what it promised would be a top-to-bottom review of the U.S. tax code, but acknowledged that it might make more sense to modify the income tax than to try to replace it.

Members of the president's advisory panel on federal tax reform said all options were on the table, including proposals to replace personal and corporate income taxes with variations on a national sales tax.

"The president is committed to major tax reform, to real tax reform, to something more than just moving the boxes around," said Treasury Secretary John W. Snow, who convened the first public hearing of the nine-member panel.

[ancient_geezer]

A Taxreform bump for you all.

If you would like to be added to this ping list let me know.

John Linder in the House(HR25) & Saxby Chambliss Senate(S25), offer a comprehensive bill to kill all income and SS/Medicare payroll taxes outright, and provide a IRS free replacement in the form of a retail sales tax:

H.R.25,S.25
A bill to promote freedom, fairness, and economic opportunity by repealing the income tax and other taxes, abolishing the Internal Revenue Service, and enacting a national retail sales tax to be administered primarily by the States.

Refer for additional information:

• http://www.fairtax.org,
• http://www.salestax.org &
• http://www.geocities.com/cmcofer/ftax.html

[laweeks]

What's there to review? Drop the whole code, all zillions of pages, and adopt a national sales tax.

Imagine how many attorneys would have to go find an honest job somewhere?

[vpintheak]

Sorry folks, but if this panel is made up of a bunch of career politicians, things can only get more jacked up than they are right now.

[freekitty]

The only way to stop these thieves of graft and greed is to stop paying taxes. Maybe they might get the hint.

[Paul C. Jesup]

A presidential commission today launched what it promised would be a top-to-bottom review of the U.S. tax code, but acknowledged that it might make more sense to modify the income tax than to try to replace it.

The LA Times can't go even one sentence without put words in people's mouths.

[knarf]

One of Quinn's laws ... everything before but is BS.

"... but acknowledged that it might make more sense to modify the income tax than to try to replace it."

[Principled]

I agree with you - pols can't very well make a decision good for us. It'll have to happen with more emphasis on the ballot box.

[Muleteam1]

The antiquated tax code is more of a hot potato than SS. And like SS, few older Americans will support changing the income tax code because they have spent a lifetime figuring out how to beat it. It's like a game of musical chairs,. . .if you have a chair to sit in, don't let them start the music.

Muleteam1

[socialismisinsidious]

"I think it's impossible. I think that the notion that we're going to get rid of everything and start over is a waste of time," Goldberg said. "Once you talk about preserving progressivity … about preserving incentives for charity and homeownership, you've got an income tax. He's not going to throw it away and start over."

exactly why these people frighten me.

[dr_who_2]

I'll bite. Yes, please put me on your ping list for tax reform stuff. Thanks.

[eluminate]

even minor reforms to simplify stuff and reduce beuracracy would save money

[dozer7]

"Sorry folks, but if this panel is made up of a bunch of career politicians, things can only get more jacked up than they are right now."

Yes indeed

[Apercu]

This is an outstanding bill. But it will never happen because of all the lawyers,accountants, & other government parasites dependent upon tax slaves - us, the American people.

[Apercu]

This is an outstanding bill. But it will never happen because of all the lawyers,accountants, & other government parasites dependent upon tax slaves - us, the American people.

[Apercu]

This is an outstanding bill. But it will never happen because of all the lawyers,accountants, & other government parasites dependent upon tax slaves - us, the American people.

[dr_who_2]

Yeah, seems to me that if one big bill can't get passed because of certain spineless congressmen/senators, try an endless barrage of smaller bills. Frankly, I think all of this concern over when/how it should be done and the deficit is nothing more than an anti-reform smoke screen. Whether proponents/opponents like it or not, the tax system will continue to evolve in the same direction as where the political winds are blowing. To that end, the more destruction that can be done to the existing insane tax code, the better. Action, not endless debate.

[Paul C. Jesup]

Actually given current liberal/socialist/leftest media/press standards (or lack there of), I would say everything before and after 'but' is BS.

[ancient_geezer]

If one chooses to sit back an watch it happen, they reap the result.

The condition upon which God hath given liberty to man is eternal vigilance; which condition if he break, servitude is at once the consequence of his crime and the punishment of his guilt."
-John Philpot Curran: Speech upon the Right of Election, 1790.

I discussed the importance of abolishing the income tax because of its tendency to form a habit of servility in the souls of a people that accepts it.

Servility of soul is bad not only in itself, it is also an open door through which will soon walk the abuses of ambitious government power.

Leaders who find themselves with governmental power over a servile people will be quick to conclude that such a people exist to serve them.

Alan Keyes 1999

[maine-iac7]

Well - this is one where we have to make ourselves heard - loud and clear and clamorous.

Let's not just lay down on this and remain the silent majority.

Otherwise, we get what we deserve...

the biggest thing is education. I have changed a lot of peoples minds by printing out the facts and figures on FAIR TAX - once they realize they'll have more in their pockets - unless they're really really rich - i.e., the rich really will, finally, pay their share - they are all for it. And when they contemplate "no more income tax forms!"

So, educate, educate, educate

[Paul C. Jesup]

The antiquated tax code is more of a hot potato than SS. And like SS,

That's why Bush is using Social Security reform to run interference for tax reform and tort reform.

[ancient_geezer]

You are now on the taxreform pinger, welcome aboard.

[inquest]

The plot thickens (not in a good way)

[ancient_geezer]

Advisory Panel first meeting press release. On the website you can find the power point presentations a& PDF transcripts of panel members and other participants

 

http://www.taxreformpanel.gov/

 

President's Advisory Panel on Federal Tax Reform
Holds First Meeting

February 16, 2005

FACT SHEET
The President’s Advisory Panel on Federal Tax Reform Holds First Meeting
• • • • •

OVERVIEW:

The President’s Advisory Panel on Federal Tax Reform held its first meeting in Washington, DC, today. President Bush established the Panel to make recommendations on ways to create a simpler, fairer, and more pro-growth tax system. The panel is led by former Senators Connie Mack and John Breaux, and consists of a distinguished group of experts and experienced people from both parties.

America has a growing, dynamic, and changing economy - but our tax code has not kept up with the times. The current tax code is a maze of special interest loopholes and complex provisions that cause America's taxpayers to spend more than six billion hours every year on paperwork and other headaches. President Bush believes that America's taxpayers deserve better. The tax panel is part of President Bush’s pledge to lead a bipartisan effort to reform and simplify the tax code.

The time that people spend complying with an overly complex tax code is a waste of resources that has been growing over time.

• The Internal Revenue Code contains more than a million words.
• The number of pages in the Internal Revenue Code and regulations has more than doubled over the past twenty years.
• In 1940, it took only two pages of instructions to fill out the Form 1040; today, the 1040 – EZ or “short form” is accompanied by 36 pages of instructions.
• Today's "short" income tax form takes more than 11 hours to prepare - about the same as the "long form" did a decade ago.
• It takes 12 pages of instructions to calculate the Earned Income Tax Credit - a basic element of income-support for the working poor.
• By 2010, more than one in five taxpayers will be forced to calculate their income taxes twice - once for the regular income tax and once for the Alternative Minimum Tax - and then pay the greater amount.
• The number of affected people will continue to grow over time.

 

President Bush's Action to Promote Tax Reform

• President Bush announced that he is making tax reform a key priority of his second term.
• On January 7, 2005, the President began this effort by creating, by Executive Order, a bipartisan panel to advise the Treasury Secretary on options to fundamentally reform the tax code to make it simpler, fairer, and more growth oriented.
• The President's goals are to make the tax code simpler and to increase long-run economic growth and job creation. Taxes should be applied fairly, and reform should recognize the importance of homeownership and charity in our American society.

Background: The President’s Advisory Panel on Federal Tax Reform

The panel will hold public meetings and seek input from individuals, businesses, and associations and organizations. It will also seek input from Members of Congress.

At today’s first meeting, the panel heard from Treasury Secretary John Snow and from other witnesses. The witnsees described the history of the federal income tax and described the differences between income and consumption taxes.

The panel will hold a series of public meetings during the next few months. The next meeting will take place on March 3, 2005 in Washington DC.

The Panel will examine the existing system and then formulate options for reform, which will be presented to the Secretary of the Treasury by July 31, 2005. This advice will inform the Secretary in his efforts to make recommendations to the President.

[Muleteam1]

Tax reform, tort reform and SS reform! Oh be still my heart! Now if we could just reform the Democratic Party, like sending them all to France, I can die happy.

Muleteam1

[groanup]

Thanks for the ping and back to the top.

[ancient_geezer]

True, but looking at the material on the websight, the commentary seem to be more the result of the articles author's opinions than any direction the panel might ultimately take.

The witnesses you would expect to support a hybrid system or sticking with the current tax system did, no surprise.
The others offered solid analysis on the alternatives in consumption tax terms and why dinking with current system is only going to lead us down a road of worse to come rather than to any fixes.

[hubbubhubbub]

Problem solved. Appoint a government commission.

[redhead]

"everything before "but" is BS."

Has MY vote for potential tagline of the day...

[lodwick]

Yet another fedgove circle jerk.

Bend over, everyone, get your KY prep going on.

[ancient_geezer]

Certainly can't put it any better than that.

Its one of those times when you work for what you believe in and shoot for the brass ring. Not to many chances as currently exist to make a difference.

This is no time to just sit back and gripe expecting someone else to carry the load. It takes a full court press or it won't happen.

[Bigun]

Well said! Well said indeed and I couldn't agree more!

[newzjunkey]

What are you talking about? Connie Mack and John Breaux don't make you feel warm and fuzzy?

Pinheads on this commission are the following:

• former Senator Connie Mack (R)
• former Senator John Breaux (D)
• former Representative Bill Frenzel, now of the Brookings Institution
  
• USC law professor Elizabeth Garrett
  
• Stanford Business School professor Ed Lazear
  
• former head of the Federal Trade Commission Timothy Muris
  
• MIT professor James Poterba
  
• former IRS chief Charles Rossotti
  
• Liz Ann Saunders, chief investment strategist at Charles Schwab

[Conservative Goddess]

"...Its one of those times when you work for what you believe in and shoot for the brass ring. Not to many chances as currently exist to make a difference.

This is no time to just sit back and gripe expecting someone else to carry the load. It takes a full court press or it won't happen...."

AMEN! Very Well Said. The time is now.....we must press on, despite the other demands on our time and talents.

[phil_will1]

"even minor reforms to simplify stuff and reduce beuracracy would save money"

Only temporarily. That is the lesson of our 90+ year failed history with trying to define just what "taxable income" is.

[phil_will1]

"The antiquated tax code is more of a hot potato than SS. And like SS, few older Americans will support changing the income tax code because they have spent a lifetime figuring out how to beat it. It's like a game of musical chairs,. . .if you have a chair to sit in, don't let them start the music."

Well said. There are some "chair sitters" who regularly post to the tax reform threads here on FR.

[phil_will1]

"Sorry folks, but if this panel is made up of a bunch of career politicians, things can only get more jacked up than they are right now."

It is my impression that former senators Mack and Breaux are the only politicians on the panel.

[phil_will1]

Did anyone catch the C-SPAN telecast?

I noticed that the LA Times quoted the former IRS Commissioner as saying nothing "Radical" could be done. OTOH Mr. Rossetti is a panel member and former IRS Commissioner, also. He is the one who has said that they could examine anyone's tax returns and find something to prosecute them for. I think Dubya picked the right former IRS Commissioner for the panel.

[ancient_geezer]

I think Dubya picked the right former IRS Commissioner for the panel..

I suspect he picked the right economist for the panel in James Poterba as well. He, of all the members of the panel, is the most knowledgible in the guts of the Fair Tax Act.

[phil_will1]

The following exchange occurrred during yesterday's hearings of the House Financial Services committee:

MADAME CHAIR: The gentleman from Georgia, Mr. Price, is recognized for five minutes.

CONGRESSMAN PRICE: Thank you, Madame Chair. I appreciate that. It’s an honor to be a part of this committee and it is indeed a privilege to personally witness your wisdom and I commend you for your dexterity and your persistence in your answers to many of the questions that have come to you today. I have a comment and then a couple of questions. I’m so pleased to hear you in your written testimony and in your spoken testimony identify 2008 as the pivotal date as it relates to the Social Security issue because–for two reasons. One, as you appropriately identify, that’s when the baby boomers begin to retire. The second reason that I believe needs to be pointed out is that on that wonderful graph of the incoming money as it relates to FICA and when we begin to dip, that’s the top of the crest and then we begin to go down where there’s more money going out than coming in. So, I commend you for that. And I don’t care whether you call it a crisis or a near crisis or a looming crisis as President Clinton called it in 1998. A rose is a rose is a rose. I think the important issue is that you said clearly, “There’s a call for action before the leading edge of the baby boomer retirement becomes evident in 2008.” And that is within three years.

My question relates to our savings rate as a nation and my understanding that the household savings rate is low as it relates to our history as a nation and also as it relates to other industrialized nations. And so I would ask you what your thoughts are on anything that we might do in terms of policy that would positively and significantly affect our savings rate as a nation.

CHAIRMAN ALAN GREENSPAN: It’s one of the most difficult problems government has had, Congressman, trying to address this particular question. And the reason is that it’s not just a question as we tend to do, to create vehicles to save, such as 401(k)s or IRAs or the like, because what we really have to do is get people to consume less of their income, because that’s what savings is. If you don’t consume less of your income and you’re building up a 401(k), it’s essentially saying that you just drew the funds from other forms of savings and you did not increase your aggregate amount of savings. So, the issue really gets down to the question of how do you increase income relative to consumption? And that is not very easy for government to address or say.

What we can do is find measures which will augment the growth rate of the economy, create incentives for growth and the like. But unless you impose something such as a consumption tax, which economists have argued for, which I suspect has very little support in the Congress, it’s difficult to see how you come to grips directly with that issue. I might add that the consumption tax issue arose essentially because there does not seem to be any other way to directly get at this issue. My suspicion is that the 1% savings rate, which is what it’s been for the last year, is probably going to be the low point and we will start to rise from there. But that’s been my expectation for a number of years and I can’t honestly wish to guarantee it because it’s a very tricky issue to forecast. The bottom line, Congressman, is I can’t really suggest anything which is significant, practical and useable to address this subject. I just hope it cures itself, sooner than later.

CONGRESSMAN PRICE: I appreciate your response and I’m so please to hear you talk about the consumption tax because, as you identified, you’ve got to have increased income in order–relative to consumption. If the money never gets to your back pocket it isn’t income. So, if I heard you correctly, I understood you to say that if we were able to move to a consumption tax, to enact a national retail sales tax, that that would, in fact, have a by-product of increasing national savings as you increase the amount of money in individuals’ pockets.

CHAIRMAN GREENSPAN: I would certainly think so, because what you’re doing is taxing consumption not income. And as a consequence or as people like to say, if you tax it you’ll get less of it and that’s probably right.

CONGRESSMAN PRICE: Thank you, Mr. Chairman. I yield back.

I heard there was another segment where Mr. Greenspan acknowledged the benefits of an NRST in addressing social security's demographic problems, but I don't have that part of the transcript.

At the President's economic summit in December, one of the economists said that they (meaning the economists participating) unanimously agreed that our low savings rate contributed to a number of other problems in our economy.

[Muleteam1]

>There are some "chair sitters" who regularly post to the tax reform threads here on FR.<<

I have to admit that I am an older American with a soft chair to sit in. However, I also have two grandchildren who I am concerned will not even have a nation to stand on if we continue to elevate FDR's socialism to something worthwhile.

Muleteam1

[OHelix]

Thanks for posting that.

[vpintheak]

I will refer you to the information a fellow Freeper gave me on this, and posted earlier on this thread.

Pinheads on this commission are the following:


former Senator Connie Mack (R)
former Senator John Breaux (D)
former Representative Bill Frenzel, now of the Brookings Institution

USC law professor Elizabeth Garrett

Stanford Business School professor Ed Lazear

former head of the Federal Trade Commission Timothy Muris

MIT professor James Poterba

former IRS chief Charles Rossotti

Liz Ann Saunders, chief investment strategist at Charles Schwab


The list of names doesn't make me feel any better about it.