Monday, December 28, 2015
TAX PROFESSIONALS FOR TAX REFORM
I have created Tax Professionals for Tax Reform, a national membership organization of tax preparers, to advocate and promote a total rewriting of the US Tax Code.
Our Tax Code has grown into a complicated and convoluted mess. The major reason for tax return errors, by both paid tax preparers and taxpayers who self-prepare, is the excessive complexity of the Code. Tax Professionals for Tax Reform firmly believes that it needs to be shredded and totally rewritten from scratch.
We believe that the one and only purpose of the Tax Code is to raise the money necessary to fund the government.
According to the organization’s “Principles of Tax Reform”, the new Tax Code must –
(1) Be simple – easy for everyone to understand. Simplicity for simplicity’s sake.
(2) Be fair and equitable - treat all taxpayers equally.
(3) Be consistent – treat specific conditions, situations, and activities, and maintain specific definitions and descriptions, the same in all instances.
(4) Encourage savings, investment, and growth.
(5) Index for inflation all allowable deductions and credits.
The new Tax Code must not –
(1) Be used for social engineering, to redistribute income or wealth, or to deliver social welfare and other government benefits.
(2) Punish ambition, entrepreneurship, investment, success, or hard work.
(3) Encourage or discourage certain economic decisions (other than savings, investment, and growth).
(4) Encourage or discourage marriage.
(5) Provide exclusive benefits for specific industries, business activities, or classes of taxpayers.
(6) Distort true economic reality.
(7) Contain any Adjusted Gross Income, or Modified Adjusted Gross Income, based reductions, phase-outs, exclusions or adjustments.
(8) Contain any refundable credits.
(9) Contain any “alternative” tax calculation systems (such as the current “Alternative Minimum Tax”).
(10) Contain any temporary deductions, credits, benefits, or provisions.
This new Code would state “Everything is taxable, except . . .” and “Nothing is deductible, except . . .”. Only those “excepts” – exclusions and deductions - that are absolutely necessary and appropriate, in the context of the “musts” and “must nots” listed above, should be added back.
I invite fellow tax professionals who support the “Principles of Tax Reform” listed above to join in the crusade for serious and substantive tax reform by becoming a member of Tax Professionals for Tax Reform. A membership application form is available on the organization’s website.