Will & Conover: Senator Wyden’s Fair Flat Tax

George Will and Steve Conover (our source link for Will’s column) give separate coverage to Senator Ron Wyden’s ‘Fair Flat Tax’ proposal here: http://www.msnbc.msn.com/id/19649892/site/newsweek/page/0/ and here: http://www.optimist123.com/optimist/2007/07/the-tax-system-.html

Conover: "…Senator Ron Wyden (Oregon Democrat) might have a better idea.  He’s pushing a tax simplification plan dubbed the "Fair Flat Tax" in spite of long odds…It’s similar in principle to the dual-rate tax described above, and it’s a compromise between the six-rate rube goldberg system we have today versus the single-rate flat tax that keeps getting nowhere…If tax simplification has a chance, Senator Wyden might be on to something."

Will: "Under Wyden’s plan, all Americans—and all corporations—would use a one-page form. There would be three rates (15, 25 and 35 percent) instead of today’s six (10, 15, 25, 28, 33 and 35) for individuals, and a single rate for corporations. The alternative minimum tax…would be abolished. The standard deductions…would be tripled…The time is ripe for reform, for two reasons. The 2001 tax cuts will expire in 2011, so Congress cannot avoid re-examining the existing tax code, which nobody, given a blank slate, would re-create. And Democrats, who control Congress, are suffering stinging disapproval for underachieving."

The Wyden plan has yet to get much traction, but it deserves serious attention. Such a dramatic simplification of the federal tax code would enhance the competitive position of the U.S. relative to the rest of the world, and that would mark a refreshing divergence from our current legislative trajectory.