When it comes to tax reform, the bipartisan deficit commission needs to think more boldly. The co-chairs’ draft report includes options for a simpler income tax structure with lower rates and fewer deductions. That would be nice, and would repeat the basic thrust of the 1986 bipartisan tax reform (which was a significant achievement but one watered down in subsequent tax code changes).Whole thing here.
Co-chairs Erskine Bowles and Alan Simpson raise politically sensitive possibilities such as reducing or eliminating the mortgage interest deduction and the child tax credit. They offer the interesting idea of an automatic trigger that would reduce loopholes if broad tax reform is not enacted by end-2012.
In other words, Bowles and Simpson don’t seem to be afraid of shaking things up, which raises the question of why their proposals ultimately amount to fiddling with the current tax system rather than replacing it with something fundamentally different.
Wednesday, November 10, 2010
My latest at FrumForum: "Deficit Panel Goes Wobbly on Tax Overhaul." Excerpt: