Tax Reform

Reposted by JayPeriod.

There is no doubt that Americans are ready for tax reform.  Every year, April 15 is viewed with more fear than a teenage girl in one of the Halloween movies.  We are over-taxed and under-represented, and that goes for the ones at the bottom of the income spectrum as well as those at the top.

Mike Huckabee’s surge in the polls has much to do with his support for the FairTax.  Until recent, I knew only a little about this proposed reform, but after reading Neal Boortz’s articles, I have learned much more about what it expects to do and what it proposes.  Still, there are many who are against it, fearing that the rich will not pay their “fair” share.  I guess they are using a different, Bill Clinton-esque, definition of fair.

To that end, though, I think there are a few changes I would make to the proposal.  First, I would eliminate the “prebate.”  I understand the reason for this portion, to ensure that those making below the poverty level are not paying taxes, but I disagree with it.  I think that most of the time, the amount they pay will not amount to much.  I also fear everyone in America getting, and becoming dependent on, a check from the government.  Eliminating the prebate from the plan would allow the consumption tax to be less.  This would be of more benefit to all.

Second, I think the biggest problem with the plan is that it allows current runaway spending to continue unabated.  Spending must be controlled and reduced.  Our economy needs it to be reduced to continue to grow.  There is so much wasteful spending, we should not be content with current spending levels.

I believe that, along with the FairTax bill, a bill should be submitted that limits what Congress can spend and on what they can spend it on.  The bill should remove certain elements of the current budget.  Our government has the responsibility to our defense, not health care.  A bill limiting spending to those things necessary on a federal level would reduce the tax burden and free states to control their own destinies, such as education.  Earmark spending and programs that are antiquated, PBS and NEA, should be outlawed and trimmed.

If this companion bill were passed, the amount of the FairTax would be further reduced.  This would be more helpful than any prebate.  As I stated, our economy would greatly benefit from a federal budget of approximately 60-70% of what it is now.  Perhaps, this would allow us to get by on a FairTax of closer to 18% rather than the 23% suggested.  This would cause prices to decrease rather then remain level.

I can get behind any bill that eliminates the IRS.  Reducing the bureaucracy in the tax system, making life simpler for average Americans, will restore faith in our nation and show the world that our “experiment” works.  I think reducing taxes and spending will resonate will with most.  I only hope whoever wins the nomination, and ultimately the election, will give serious consideration to true tax reform, which must include spending reform.