Everyone Should Take the
Flat-Tax Rate Test
by


This first appeared in the
North Hills News Record

My federal income tax forms came the other day and I get tired just looking at them. I know I'm not the only one who dreads April 15 so it's no surprise that the flat income tax is catching on so fast. Last week,  Steve Forbes, who is a big fan of the flat tax, made the cover of several major magazines (not GQ). And since Mr. Forbes is now a serious GOP presidential contender, the flat tax is getting quite a bit of media exposure.

There are several flat tax proposals. Under the plan I could support, a family of four would pay no income tax on their first $36,000. All income over $36,000 is taxed at a rate of 17 percent. Basically, there are no deductions and no exemptions--period. Everybody could do their taxes in five minutes. (I truly believe, however, that if God is satisfied with 10% of our income, so should be the U.S. government!)

But what about the critics? This newspaper claims "Most economists predict a 17 percent flat tax would increase the federal deficit, something we certainly don't need."

Obviously, this newspaper is regurgitating press releases rather than collecting original data. Any economist that might make this claim has either become a tax accountant or has made a livelihood out of maintaining the status quo in public policy.

It's a fact that lower tax rates generate more, not less, tax revenue. But these ditzy economists and their cohorts in the media assume that only the government can wisely spend money.

The truth is that if the IRS allows American families to keep more of their hard-earned income, they'll end up spending most of it. More consumer spending is good for business. And what's good for business is good for the economy. And what's good for the economy is good for the federal coffers.

But even if revenues didn't increase, so what? Does anyone really think we need to spend $1 million to study brown tree snakes or $100,000 to find out why people don't like beets? We haven't created a deficit for lack of revenue. We have a deficit because Congress spends too much.

This newspaper also believes a flat tax "would tax earned income and not investment income." That's simply not true. With a flat tax, businesses pay a tax directly to the government before they pay dividends to their stock-holding owners. This is far more efficient since there's no need for the IRS bureaucracy to compare what businesses say they are earning with what individuals say they are receiving. This plugs a huge hole that exists in our current tax system.

The comment also was made that a flat tax "will increase the gap between the average working American and those who make most of their money from inheritance or stocks and bonds." A comment like conveys a sole ambition of making the rich pay more taxes. Not only is that stupid economics, it's absurd to punish 99 percent of the population just to "get even" with the other 1 percent.

I challenge everyone. Take the flat tax test! After you fill out your taxes, decide whether or not you'd be better off with a flat tax. I know I would be.

If you aren't, then you're not paying YOUR FAIR SHARE!

© Copyright Deborah A. Ayers 1996. All rights reserved.