Simplify Tax Code With Blank Slate
|October 27, 2013||Posted by Staff under Editorials|
This 2013 excerpt is from the Editorial Board, USAToday, July 22.
For the first time since 1986, key members of Congress are making a coordinated push to overhaul the nation’s disgracefully complex tax code.
As anyone who dreads April 15 knows, the code is a farce that wastes taxpayers’ time and money, caters to the influential lobbies, and corrupts Congress. In the quarter-century since the last reform, it has grown so complicated that it costs individuals and companies $160 billion each year to comply. That’s nearly double what the federal government spends annually on highways, bridges, airports and other transportation projects.
The Senate finance panel has opted for what it calls a “blank slate” approach. Senators Baucus and Hatch will introduce a bill that strips the tax code of many of the numerous breaks that make it so difficult to navigate and add up to about $1.3 trillion in backdoor spending every year. Supporters of breaks would have to pass amendments to add them back.
The special interests that benefit from tax breaks will, of course, fight like mad to preserve them. These include the big deductions that benefit real estate, medical care, and stock brokerage. They also include the narrower breaks for such things as ethanol, coal, and energy-efficient appliances.
By scaling back deductions for mortgage interest, health care premiums and other expenditures, the top federal rate could be reduced from 39.6% to 28%, and the deficit could be reduced by $80 billion over nine years.