Tackling tax code
There are some rumblings in Washington, D.C., now about seriously tackling tax reform.
There has been a general consensus for years now that the tax code is too long, too complex and contains too many favors for special interests.
On Wednesday, House Ways and Means Chairman David Camp released a proposal that would cut the number of personal tax rates from seven to two and allow 95 percent of filers to get the lowest rate by claiming the standard deduction.
According to Accounting Today (accountingtoday.com), Camp’s proposal is a job creator that could raise the gross domestic product by up to 20 percent. The website refers to an analysis by the nonpartisan Joint Committee on Taxation that says Camp’s proposal could create up to 1.8 million jobs and up the GDP by $3.4 trillion.
The Joint Committee on Taxation’s data show an average middle-class family could have another $1,300 in its pocket because of the lower tax rates and more robust economy.
Among the highlights of Camp’s plan cited by Accounting Today are:
* Just two tax rates – 10 percent and 25 percent.
* Larger standard deduction – $11,000 for individuals, $22,000 for married couples.
* Child tax credit increased to $1,500 per child.
* No alternative minimum tax.
* A new simplified tax form for seniors.
* Shrinks and simplifies the tax code by repealing 220 sections. This would cut the tax code by 25 percent.
Camp’s proposal, however, is just that – a proposal. A Washington Post headline says it is dead on arrival, citing the impossibility of getting such a broad issue decided in an election year.
But, at least now, there is something concrete to debate. We have Rep. Camp to thank for that.
* Editorials reflect the opinion of the publisher.