From Tax 'Reform' Panel, Expect a Foregone Conclusion

washingtonpost.com ^ | Tuesday, April 12, 2005 | By Allan Sloan

[repinwi]

Now that April 15th is almost here, you're likely to be either licking your wounds from filling out tax returns or obsessing about the imminence of tax day. Maybe even both.

< snip >

Now, let's look at Bush's tax "reform" commission. Instead of letting the commission propose the best possible tax system, Bush has hemmed it in.

< snip >

So I'll bet my (nonexistent) refund the tax "reform" proposals will go something like this. Leave Bush's existing tax cuts in place. Eliminate the estate tax. Eliminate some or all of the remaining taxes on income from investments. Eliminate or pare back (AMT). Make up for these cuts by adopting something like a broad-based national sales tax or value-added tax. Eliminate or pare deductions for state and local taxes, which the AMT has begun to do indirectly.

The AMT mostly affects people in high-tax (read: Democratic-leaning) states but is spreading to taxpayers throughout the country. Even though it's clawing back an increasing proportion of the Bush tax cuts, the president has never proposed cutting it. Clearly, an AMT fix is being held hostage to make a national sales tax or value-added tax more palatable.

This "reform" package would be part of Bush's unstated but clear goal of turning the income tax into a tax on wages only, and making the country even friendlier for inherited wealth and for people with lots of income from investments. As for wage slaves who are trying to accumulate wealth, good luck. They'll pay tax not only on the salary they earn, but also on what they spend. A national sales or value-added tax would fall disproportionately on lower-income people who spend everything (or almost everything) they make. But there's nothing in Bush's instructions to the commission saying that would be bad.

[repinwi]

I know, I know...it's from the washington post. Thoughts?

[elbucko]

I really don't think that President Bush and the Republican Congress have any intentions of improving the tax system of the US. When Bush is gone, the tax system will be the same as it is now. I wish I was wrong, but I don't think so.

[rwrcpa1]

What a nightmare that would be.

My choice: Fair Tax Act of 2005 www.fairtax.org

[Always Right]

This guy has no insight and seems to be pulling stuff out of his butt. You can tell by his use of terms like 'wage slaves' he is just a communists and an anti-Bush one at that. Don't see why anyone would print his crap let alone read it.

[Dead Dog]

The fact that the Comm-Post is in a class envy pissyfit gives me hope.

They error in his reasoning, is that the NRST proposals are not a suppliment, but a replacement for wage taxes. It would be easier politically to go NRST only, than to have both.