Another Think Tank Slams the Presidential Panel
From the newswire:
WASHINGTON, Oct. 20 /U.S. Newswire/ — According to the Institute for Policy Innovation (IPI), a free-market think tank and publisher of “The Roadmap to Tax Reform,” a massive project utilizing tax experts from around the country, the President’s Tax Reform Commission’s recent proposals are shaping up as a missed opportunity.
“The first mistake the Commission has made is that it has failed to insist on dynamic scoring of its proposals for reform,” said IPI President Tom Giovanetti. “In other words, while there is almost universal agreement that the right kind of tax reform will result in increased economic growth, the Commission hasn’t even bothered to figure in this increased economic growth into its proposals.”
“And the second mistake the Commission has made is its failure to recognize that our current tax code taxes the wrong thing. The current code attempts to tax income, rather than consumption, whereas the conclusion of IP’s “Road Map to Tax Reform” was that consumption is the appropriate base for taxation. Much of the headache and complication in our current tax code is the result of exemptions, exclusions, deductions and credits designed to mitigate the harm done by taxing income rather than consumption.”
There are any number of ways to address the fundamental problem of the tax code, including a savings-exempt consumed income tax, and the Commission appears to be toying with the latter idea, albeit with steeply progressive multiple rate structure that will undermine most of its benefits.
IPI Research Associate George Pieler added, “Pending the panel’s full recommendation, their failure to significantly reduce tax rates across the board is the ’smoking gun’ that their work has failed to meet the test of real, fundamental tax reform.
“Without putting rate reduction at the top of the priority list (as Alan Greenspan recommended to the Panel way back in March), the President’s Tax Reform Advisory Panel simply couldn’t come up with a plan that would matter to the average taxpayer, or that could muster any political momentum. Now attention will shift to the political process where, ironically, there may be better prospects for a good result.”
While the best hope was that the Commission would take advantage of all the excellent research that has been done over the past 20 years on tax reform and come up with a recommendation for sweeping, fundamental reform, perhaps the occasion of the Commission’s failure will at least begin a public debate on the need for fundamental tax reform.
The IPI experts are available for comment. Contact Sonia Blumstein at 703-912-5742. IPI is an independent, public policy think tank with offices in Washington, DC and Dallas, Texas.
I am so!!! upset at the panel. They had not even looked at the fair tax plan. On and off for about a year I’ve looked at the research, and my conclution is this plan is FAIR. I do not see that it could hurt low income families. I do believe more eduction for the poor on how to spend there money will be needed.
I’m a middle incomer that tried my hand as a small buisness owner, the only thing I had problem with is the extra emp. taxes. It is sad that if you like to give a bouns with no taxes attached you can’t. I alwayed believed the employees should get a bouns, every now and then that uncle sam doesn’t take anything, as a note work well done Thanks.