Posted on 10/20/2011 6:02:27 PM PDT by Kaslin
Tax Reform: His campaign flagging, GOP presidential candidate Rick Perry is about to unveil what he hopes will be a game-changer: a flat tax. Whether it works for him or not, we're glad to see this bold idea part of the mix.
We like Herman Cain a lot. But his 9-9-9 tax plan, not so much. Perry, no doubt trying to recoup some of his lost support, will unveil a flat tax proposal on Tuesday as a counter-salvo to Cain's popular idea. Count us among the intrigued.
Sure, as the cliche goes, the devil is in the details. We don't know the particulars of his plan, and we'll reserve specific judgment as a result. That said, the idea of introducing a much flatter, much fairer tax code is one that can no longer be avoided. And the flatter, the better.
Critics argue that a flat tax would basically be a giveaway to the rich, while socking those in the middle class with a much higher burden. And they say it wouldn't raise as much in revenue as the current highly progressive tax system. Such criticisms of the flat tax are either wrong, misleading or misguided.
A flat tax has one enormous, immediate benefit: lower compliance costs. As a recent study by economists Arthur Laffer, Wayne Winegarden and John Childs notes, U.S. taxpayers will spend $431 billion this year just to cope with our byzantine tax code. That is fully a third of all income taxes collected.
This would be funny if it weren't so wasteful. The big reason is complexity: As of 2010, the tax code contained 3.8 million words — a 171% jump from 2001.
(Excerpt) Read more at investors.com ...
Herman Cain explicitly stated that one of the intentions of “999” was to bring flat tax and fair tax people to the table for some sort of resolution.
Flat tax is a fair tax. 10% is good with me. On everything. It should be same for everything. The GD “fair tax” is anything but.Hiding behind consumption tax is still progressive, no matter how you slice it. The only rub, for me, is that the budget for ‘15 (for example) needs to be proposed by Oct 15th, thoroughly discussed, debated and voted upon by OUR elected representatives, for providing the military and necessary government function, to be voted on EACH YEAR by Nov. 15. Move voting back to then amd have a vote EVERY year. Simultaneously on that rotation, one sixth of the offices are turned over. No more than one (1) six year term for any office and subject to repeal. No lifers, no careerism and no multi-million dollar givebacks at the end of your ter,
A republic counts on an informed and active electorate. What better way then to LITERALLY have us put our money where our mouth is each and every year?
“Herman Cain explicitly stated that one of the intentions of “999” was to bring flat tax and fair tax people to the table for some sort of resolution.”
Our best hope of a Republic is in the middle somewhere.
I have always preferred a flat tax with no deductions. Much easier to implement. Take out a fixed amount from your paycheck and everyone is done.
Unless the middle class starts paying more the revenue problem won't be resolved.Steve Forbes' flat tax proposal floundered unnecessarily on the rock of the abolition of the mortgage interest deduction. That was entirely gratuitous, since the law "coulda shoulda woulda" had a provision in it to compensate the loss of that deduction at the expense of the lender of the mortgage, who would otherwise have a windfall in the elimination of tax on interest. The point being that the taxability of interest payments would, under a flat tax, precisely balance the deduction accorded the debtor (always assuming that the debtor itemized that deduction, as not all debtors actually do).The provision would've been highhanded in adjusting contracts, but it would have kept the parties whole in effect. The other way of doing it would have been to grandfather in the existing deductibility/taxability for existing mortgage loans, outlawing deductibility and taxability of interest on future loans.
Unless government spending is limited, the "revenue problem" won't be resolved.
I agree. I would also end witholding..
If this flat tax proposal simply addresses the income tax it'll be a let down.
I liked Forbes' flat tax and I was amused that those in love with the leviathan progressive tax code could make their own choice under which to pay.
The point in the article about compliance cost cannot be stated more often or more emphatically. It's insane. It's stupid. It's self-defeating. It's hundreds of millions of dollars in wasted capital that could be used to EMPLOY PRODUCTIVE WORKERS.
One thing I will say, however, Newt had a good point in the last debate. While massive tax reform is good, important, even necessary, the economy cannot wait for that debate and legislation. There will have to be an intermediate, immediate change to the existing code. Cain acknowledges that in his call for the super committee to make such proposals but that doesn't get much play and just won't happen under this regime, this congress.
This is the nuts-n-bolts of the who problem and solution.
IMO, Americans need to realize that our elected officials have a certain mind-set (spend/spend, force the people to pay by raising taxes (on something-anything))
Just listen to all the "new" ideas that so many politicians are throwing around on how to raise revenue. How many do you hear talk about reigning in spending?
They can't stand the thought of not being able to spend, so they have to think of ways to get the money to spend on the things that our newly elected officials are fighting to eliminate (shaking head).
Taxes are only 1/2 the issue....the other 1/2....which all of DC is desperately hoping nobody gets around to, is hatcheting 1/2 of the the Fed Gov...physically, regulatorily and legislatively.
One...or the other...of itself...does little to address the net problem.
No it doesn’t HAVE to be a consumption tax which is unnecessarily complicated to implement and a lousy idea. But dream on. Flat tax is the way to go
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