[upstatenyrepublican]

15 % of everything is fair. Terresa Heinz paid 15 % probably because her income came from investment. What about all the tax free municipal bonds? Should that loophole be closed? That would hit the super rich hard. It would also raise interest rates since tax-free would no longer apply. Also the tax on real property would go down because it wouldn't be a deduction, and people would vote the tax and spend local governments out. And finally, home interest rates would be low or home prices would drop if home morgage interest wasn't deductable. It could ge very interesting!

[konaice]

What about all the tax free municipal bonds? Should that loophole be closed?

Yes.

That would hit the super rich hard.

No, it only applies to the income they earn from the bonds, not the principal they have tied up in bonds

It would also raise interest rates since tax-free would no longer apply.

Thats not at all clear, because some bonds could be exempted from sales tax. But so what? Even if the interest rate goes up, the net effect will be the same, because Bush as said it will be revenue neutral...

And finally, home interest rates would be low or home prices would drop if home morgage interest wasn't deductable.

That does not necessarily follow. A house's value is not determined by the mortgage deduction. The market doesn't even recognize the deduction in the setting of the price. It might affect the seller, but they have more money to pay for the house because they have no income tax. If you wanted to have the government subsidize house purchases as they do with the mortage deduction, all you need do is have a lower sales tax on houses.

[kevkrom]

It would also raise interest rates since tax-free would no longer apply.

You have that backwards -- under an NRST, all interest will approach the current tax-free (lower) rates, because all interest income will be tax-free.