Thursday, September 10, 2015

JEB offers his tax plan

One of the first, maybe the first, to come out with a concrete proposal.  He posted it on the Op Ed page of Wednesday's Wall St Journal.  The "MSM"  (NYT and WaPo) probably won't carry it, but the Journal has four times the circulation of the NYT, and even a bigger lead over WaPo. 
   JEB proposes three personal income tax rates, 10%, 25%, and 28%, 20% on corporate profits, and 100% write off of capital improvements.  All decent ideas.  He proposed closing loopholes although he failed to get  specific and name loopholes.  He is happy to have 15 million people owe no federal income tax.  He will scrap the "alternate minimum tax".  He will increase the standard deduction, expand "earned income tax credit" and retains the charitable contributions deduction.
   Let's give JEB  credit for addressing a real issue, and proposing real reforms.
   However I would do it a little bit differently.  I believe that every one, no matter  how poor, ought to pay some tax, just to let them feel the pain.  It need not be much, 5% would do fine.  But everyone ought to pay something.  The "earned income tax credit" serves to zero out low income people's taxes, so long as they have some children.  The formula and rules for earned income tax credit are so complicated that nobody really understands what's going down.  Was it me, I'd scrap the entire thing, just to simply the tax code.  Set the bottom rate at 5%, and be done with it.
   While we are at it, outlaw all those "worksheets" the IRS puts in the 1040 instructions.  If they cannot state a tax rule in a single sentence of plain English, the rule is too complicated and we should scrap it outright.  Those little worksheets walk the taxpayer thru an indescribably complex rule.  We don't need indescribably complex rules. 
   Close loopholes.  Just about everything on Schedule A is a loophole.  Drop them all, medical, mortgage interest, state and local taxes, and the rest.  Set the middle tax bracket at 17%.  After deductions and hassling and rassling and loosing an entire weekend to doing my taxes, I always wound up paying 17% after all the mickey mouse. 

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