In my 2012 primer on fundamental tax reform, I explained that the three biggest warts in the current system:
- High tax rates that penalize productive behavior.
- Pervasive double taxation that discourages saving and investment.
- Corrupt loopholes and cronyism that bribe people to make less productive choices.
These problems all need to be addressed, but I also acknowledged additional concerns with the internal revenue code, such as worldwide taxation and erosion of constitutional freedoms an civil liberties.
In a perfect world, we would shrink government to such a small size that there was no need for any sort of broad-based tax (remember, the United States prospered greatly for most of our history when there was no income tax).
In a good world, we could at least replace the corrupt internal revenue code with a simple and fair flat tax.
In today’s Washington, the best we can hope for is incremental reform.
But some incremental reforms can be very positive, and that’s the best way of describing the “Economic Growth and Family Fairness Tax Reform Plan” unveiled today by Senator Marco Rubio of Florida and Senator Mike Lee of Utah.