Conversation begins on the disastrous economic impact of the current tax code
WASHINGTON — Americans for Tax Reform President Grover Norquist today praised the President’s Advisory Panel on Federal Tax Reform for its release of tax reform proposals. It helps begin the dialogue on fundamental tax reform, and serves to highlight universal goals of economic growth, job creation, and increasing the incentives for work, saving, and investment.
The panel released its report today with two main recommendations – a simplified income tax and the Growth and Investment Tax which moves the nation towards a consumption based tax system. Both measures will be a dramatic improvement over the current system which currently discourages work, savings, and investment and thus inhibits economic growth.
“I applaud the efforts of the Commission for beginning the debate on tax reform,” said Norquist. “There is a broad consensus in the tax reform movement that income should be taxed one time and at one rate only. The challenge now for the tax reform movement is to use this report as a vehicle to pass an economic growth package which moves the nation closer to a consumption based tax system and lifts economic growth. I am further encouraged by the fact that the Commission ruled out a return free tax filing scheme which ultimately would have made the IRS a tax preparer and collector.”
ATR has long advocated a tax system that taxes all income once and only once, at a low, flat rate. The current tax system double-taxes savings and investment, double taxes income earned abroad, forces businesses to depreciate rather than expense purchases of equipment and structures, taxes after death, and subjects income to steep marginal tax rates that discourage work, saving, and investment.
“While not perfect, this report addresses the inequities and anti-growth distortions in the current tax system,” continued Norquist. “History has demonstrated that the best way to move toward the consumption base, flat rate system that would do this is through incremental changes to the current code. Each year of the Bush Administration, there has been a tax cut that has moved the system closer and closer to a consumption base with flatter rates. The elements revealed today by the commission take a larger chunk of the apple and I look forward to Congress and Administration moving swiftly to pass an economic growth package which revamps the current tax code.”