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Heritage
Foundation
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Ways to Make April 15 Less Painful
02/27/2014
Yesterday
you told us what you think Washington should be doing—and more than
a few of you said dealing with our horrendous taxes.
Representative
Dave Camp (R-MI) rolled out a plan for tax reform yesterday that we
hope will shift the conversation to something that would benefit all
Americans. As Heritage chief economist Stephen Moore said, “The tax
code stables in Washington haven’t been cleaned out since 1986.”
And it shows.
Here
are three things Congress should be including in tax reform—so that
we can all dread April 15 a little less.
1.
Lower tax rates.
The
most obvious way to improve everyone’s year: Lower tax rates for
individuals and businesses. President Obama often talks about closing
tax “loopholes”—but he really means raising taxes. Camp asserts
that “If loopholes are closed, Americans should get the benefit by
way of lower rates.”
And
for those interested in squeezing the rich—don’t worry, they’ll
always be paying more taxes. As Moore notes, “the evidence from
history shows that lower tax rates are usually associated with higher
overall tax receipts and more taxes paid by the rich.”
2.
Simplify, simplify, simplify.
How
much paperwork are you dealing with this tax season? Sure, the
infamous Form 1040 is only two pages, but the general instructions
for it total 104 pages.
One
of our readers submitted this idea yesterday: “Simplify taxes. NO
ONE understands them (including my CPA).”
What
if you could just mail in a postcard to the IRS?
That’s
the idea behind the New Flat Tax that The Heritage Foundation has
suggested. Heritage experts have explained that if this were in
place, “American taxpayers will pay a single, simple tax
rate—roughly 28 percent.” It would replace all federal income
taxes, as well as the death tax and payroll taxes.
How
could anyone be against a simpler system? Well, if you’ve ever used
software like TurboTax or had to call an accountant or lawyer for tax
preparation…you’ve glimpsed how many people make their living off
of the labyrinth of tax rules.
Camp
says the tax code should be simpler “so every family can do its own
taxes confidently, without fearing an audit, or wondering if someone
else who can afford an expensive accountant is getting a better
deal.”
3.
Let us be clear.
Economist
and author Walter Williams once said that it would radically change
Americans’ view of taxes if each person had to take his entire
family down to a government office and pay his taxes in cash while
his kids watched.
“Because
of income and payroll tax withholding and the hidden costs of
corporate and excise taxes, most Americans have little idea how much
they are paying to fund the massive federal government,” says
Heritage expert Curtis Dubay.
Tax
reform should make the system more transparent (and simplifying
payments would go a long way toward that). People should be able to
tell how many times they are being taxed, and why.
Dubay
reminds lawmakers that “Tax reform is not a way for Congress to
extract more of the taxpayers’ hard-earned income.” The goal is
to boost the economy—and that means jobs, wages, and retirement
savings. This should be a movement all Americans can get behind.
Read
this article with links, and others, at Heritage Foundation
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