Before I “leave” for my tax filing season hiatus let me identifytwo guidelines that I hope the idiots in Congress will seriously consider ifthey actually do, as promised, start to address substantive tax reform.
(1) Recognize andacknowledge that the purpose of the federal income tax is to raise the moneynecessary for the administration of the government and government sponsoredprograms. It is not to be used to “redistributeincome” or as a method for delivery of social welfare and other governmentbenefits.
Remove from the Tax Code the Earned Income Tax Credit and therefundable Child Tax Credit and instead distribute these benefits via existingfederal welfare programs for Aid to Families with Dependent Children.
Remove from the Tax Code all the various educational benefitsand instead distribute these benefits via existing federal programs forproviding direct student financial aid.
Remove energy and other such personal and business credits fromthe Tax Code and distribute these benefits via Cash-For-Clunckers-like directdiscount or rebate programs.
Only use the Tax Code to encourage such things as savings andcharitable giving.
(2) Keep It Simple,Stupid.
Have only one Tax Table and only one Filing Status. The Code should be “marriage neutral”. Remove the marriage penalty and the marriagebenefit. Tax married couples as twosingle individuals. Compensate byincreased exemption amounts for dependent children.
Remove all AGI-based reductions, phase-outs, exclusions andadjustments. No PEP or Pease.
Eliminate the dreaded Alternative Minimum Tax.
Tax Social Security and Railroad Retirement benefits the same asany other pension with “after-tax” employee contributions – using theSimplified Method or the method used by New Jersey for determining statetaxable IRA distributions.
TTFN
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