Don't call it a comeback
Maybe the flat-tax is making a comeback. And once again someone else does a better job discussing it that I could (here it's Mr. Bartlett). The flat-tax is one of those ideas that had traction but just died, and I never could figure out why. I'm borderline single issue on this. If Bush gets this passed, then he will move way up in my book (and we all know how bad everyone wants to move up in my book).
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I don't even know where to start here. We could begin with the premise that people cheat on their taxes because others pay less. Sorry, people cheat on their taxes because it is a rational economic decision to do so, (particularly in this administration, which has cut the budget for audits, an interesting strategy to fight the "crisis in tax administration")not because its unfair. I am looking forward to the free market folks I blog with to make the case against that.
Which leads to the second point, that a flat tax will make people refrain from organizing their affairs to reduce their tax burden. Later in the piece he acknolwdges that "A flat tax is not a cure all for tax evasion."
There is not one shred of evidence provided that a flat tax will increase compliance, instead the author just states it a few times as a truth.
Next point: Russia???? Really, An autocratic state where the capitalists are thrown in jail, where tax revenue is famously uncollected, where the gap between rich and poor is staggering, is why we should buy in, is the best example in the world?
Even if you cede the inherent fairness issue that we should all pay the same (which i don't) there is no good reason mentioned in the entire piece other than a conservative law Proffessor from......The birthplace of Milton Friedman Economics making a completely unprovable assertion.
Maybe the flat tax is a good idea, but if so, make the case. If I were to make an antiwar argument, I wouldn't link to moveon.org, beeaaatch.
Here's an interesting paper that might help with the "shred of evidence." http://www.bu.edu/econ/ied/neudc/papers/Fisman-final.pdf
Also, cheating and legal minimizing are two completely different things. Its not cheating to take the mortgage tax deduction. The issue here is avoiding, not evading. The general theory is that the simpler and "fairer" the government makes the tax system, the less the incentive to go through the cost and hassle of avoiding. Think of it this way. If you can pay an accountant $500 and spend hours or days implementing the strategy to save $550 bucks, would you? Most would just pay the $550. Your words "rational" economic decision perfectly states this. Its not "obsessive" economic decision. Also, efficiency increases, IRS budget decreases, and we have a tax policy we all understand. Ironically, those who cannot afford the representation often pay more taxes than those who can. Rational tax policy also decreases expenses and increases efficiency by decreasing the amount of time spent in court. Also, maybe you like loopholes, but I'm against them. Finally, you're right. What does Harvard know about business and economics? I mean its not like its UCF or anything.
True, the flat-tax is not a cure all for tax evasion. I guess it does make much more sense to wait around for a magic bullet that to move towards a better idea. In fact, I think we should fire all the cops. We still have crime, so clearly cops are not a cure all for crime. We should wait around for a better idea.
http://www.theonion.com/wdyt/index.php?issue=4110
I'm trying to think of something more difficult to defend than the current tax code...I mean even Satan, at least, has an understandable objective and efficient methods. But I do admire McLieb's efforts...it shows some real pluck.
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