Time is ripe for tax reform
We read a column by Charles Krauthammer of The Washington Post that proposed something that should have been obvious to every politician in D.C.:
Tax reform could be a positive consequence from the scandal that has gripped the Internal Revenue Service this year.
Krauthammer points out that there is already bipartisan support for reform. Democrat Max Baucus in the Senate and Republican Dave Camp in the House both want a simplified tax code that will close loopholes that benefit those with the most strident lobbyists. These gentlemen chair the tax-writing committees in the two legislative chambers.
Their goal is to generate enough revenue from this tightening and simplification to allow for lower tax rates.
As we’ve said before, we think deductions for first home mortgage interest, charitable contributions and a per-person personal exemption should be all that is needed for individuals. As one presidential candidate remarked several years ago, individuals should be able to file their taxes on a postcard.
For businesses, elimination of special interest deductions should be the No. 1 goal. Basically, business taxes should be based on gross revenues minus cost of doing business equals taxable income.
The thousands of pages of tax code that exist today are there for one simple reason – to grant favored treatment to those rich enough to demand or purchase it from politicians.
Tax simplification will bring fairness to the code. It will also mean that for the first time in generations, the American public will understand how taxes are figured.
That would be a wonderful byproduct of the IRS scandal.
* Editorials reflect the opinion of the publisher.