Davey Jones III
ACC 307, Federal Taxation
Ms. Phillips
This is why we need a flat tax, “If you get rid of two-thirds to three-quarters of the deductions and exemptions and carve-outs of the tax system, you’re not going to need all these IRS agents snooping into your financial records.” (Moore, 2013) “Publisher and former Republican presidential candidate Steve Forbes, who made the tax proposal famous in his 1992 presidential-primary bid, said, “The power of the IRS derives from the complexity of the tax code. . . . With a simple flat tax you have single rate, deductions for adults and children, and that’s it. . . . Simplicity is the best enemy of the abuse of power.” (Moore, 2013)
Currently, the tax law presents taxpayers with a great deal of complexity, unpredictability and compliance …show more content…
First a low tax rate is the best known feature of tax reform. A low tax rate is designed to minimize the penalty of work, entrepreneurship, and productive behavior. Secondly, no double taxation of saving and investment. All major tax reform plans, such as the flat tax and national sales tax, get rid of the tax bias against income that is saved and invested. “The capital gains tax, double tax on dividends, and death tax are all abolished.” (Tax Reform of Flat Tax) “Shifting to a system that taxes economic activity only one time will boost capital formation, thus facilitating an increase in productivity and wages.” (Tax Reform of Flat Tax) Last but not least, no distorting loopholes, with the exception of a family-based allowance designed to protect lower-income people, the main tax reform plans get rid of all deductions, exemptions, shelters, preference, exclusions, and credits. By creating a neutral tax system, this ensures that decisions are made on the basis of economic fundamentals, not tax