Tuesday, May 16, 2006

tax reform is code for

In Utah, like in Washington, "tax reform" is code for making the tax code more regressive. That is, the burden of the tax base is shifted down to the middle class or lower-middle class, loopholes for big business and super-rich are Mack Truck sized, and the results are eventual cuts in popular social programs.

Utah's Governor Huntsman is trying to help out his fellow billioniares with his flat tax proposal. Thankfully, at least three versions so far have been killed. The latest idea? "Huntsman and some House members are already floating a "dual track" tax-reform scheme that would allow taxpayers to choose to file under either the existing tax code, with its myriad deductions and credits, or a flat tax of 4.8 percent with no deductions."

For me, tax reform means making the tax simplier and fairer. More simple by combining tax credits and deductions and having someone who speaks English write the forms. It shouldn't take an econ major to fill out the worksheet for the Earned Income Tax Credit (EITC), or someone at H&R Block. Taxes should be clear enough that unless you have secret bank accounts, you could easily do your taxes without tax prep firms. [Sorry Accounting friends] By more fair, I mean that everyone pay a share proportional to what they can afford and how it hurts them. That means eliminating the cap on payroll taxes, so Bill Gates pays the same percentage as tomato pickers in California. It also means thinking about getting rid of payroll taxes all together and just raising income taxes and capital gains taxes accordingly. It means thinking about John Edwards' proposal to make capital gains tax equal to your income tax level. It means keeping the Paris Hilton Tax (aka Estate Tax) for those who don't one a family farm or small business.

That's a progressive tax reform proposal I would like to see, no more of these no billioniare left behind bills.

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