Tax Reform and The Flat Tax

___We talk a lot about tax reform, but nothing gets done. The reason is that Congress' power comes from giving credits, deductions and other "gifts" using the tax code. These are legal bribes to keep themselves in office.

___The problem with the flat tax, is 1) it is not really flat; 2) it keeps the income tax and the IRS; 3) Congress won't pass it. The flat tax most often proposed keeps the charitable giving and mortgage interest deductions, so it is not "flat." Americans will still have to keep years of data on income and expenses. The IRS will be necessary to catch cheats. There is always the danger that the IRS will be used as a partisan weapon to punish those who disagree with the current administration's ideology. Stalin murdered tens of millions in order to consolidate his political power. The IRS assault on conservatives is a smaller example of the same thinking. Congress likes power. Power corrupts, and absolute power corrupts absolutely!

___The fair tax has been studied for decades. Two books have been written to answer its' critics. It is a non-regressive consumption tax which would be collected alongside the sales taxes. Step one is the repeal of the 16th Amendment. Taxes will be more obvious. We will pay them whenever we shop rather than on payday, quarterly or by 15 April. The fair tax replaces payroll, FICA and other taxes, so the paychecks of most people will be significantly higher. There is no tax on used goods, so the flea market industry will flourish.

___People do not like taxes. They try to minimize their tax by minimizing the thing taxed (income). It is far better to minimize consumption - particularly with obesity as a major problem.