Almost everyone is lying about tax reform

  • Article by: Ramesh Ponnuru , Bloomberg News
  • Updated: December 18, 2012 - 1:29 PM

Despite what people say, it would be either undesirable or politically impossible to reduce the largest loopholes in the tax code.

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macsacDec. 18, 12 1:48 PM

2013 is the 100 year anniversary of the Federal income tax. I think it's time it's retired. Bring on the fair tax. No loopholes for anyone, and with the pre-bate it still offers a level progressivity.

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groover6Dec. 18, 12 1:51 PM

However, our special interest tax code could be called the “full-employment act for tax accountants and tax lawyers.”

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aj11917Dec. 18, 12 2:22 PM

All monies earned either through a job, investment,interest or whatever should be taxed the same percentage. Also, people that have incomes over $500k should lose all deductions over that amount.

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jhaldrichDec. 18, 12 2:39 PM

This is what should be done - 1) Eliminate the Mortgage Interest deduction. Why should I subsidize someone who wants bigger, better, more? Plus, it's not as much as people think. 2) Move the Charitable deductions to page one of the 1040, which allows EVERYONE to donate to charities. 3) Allow people to deduct health insurance premiums on page one of the 1040. Why should people who have insurance through their job be able to deduct dollar one when people who purchase on their own need 7.5% of their adjusted gross income to do. Again, this is probably fairer. But then again, the tax code wasn't written to be fair.

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foreseer2Dec. 18, 12 2:58 PM

The article should be titled Republican columnist doesn't like the idea of collecting more taxes. The main reason to make changes in the code is to get additional income to reduce the budget deficit and make things more fair. He didn't even bother to provide a complete list, omitting the very important deduction for charitable contributions, a favorite one of high income households. Take the "other taxes" loophole. Paying state or local income taxes is not optional - one has to pay and asking people to move to low tax states is unreasonable. However, property taxes - whether you pay them depends on whether you decide to buy a home and how much of a home you ownr. That tax benefit could and should be capped. Favorable tax treatment for capital gains and dividends? Poor people work an extra job to make extra money - and pay regular rates. Rich people invest their money - and get a tax benefit. No brainer - tax all income the same. Home interest deduction - again, it is most important to get people into new houses. Do we have to subsidize a wealthy person trading up to a bigger mansion, when renters get no tax break at all? I don't think so - put in a cap. Insurance premiums and medical expenses. Here those with insurance get a benefit, those without (generally much poorer) do not. I think that all medical expenses above a certain percentage of income should be tax exempt, but that this should be handled not by the employer, but when one files. If so people start to get a clue how much they are spending. I would encourage you to think through each of these loopholes yourself, based on what makes sense to you, without the help of a columnist with a purely political agenda.

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foreseer2Dec. 18, 12 3:01 PM

"Almost everyone is lying about tax reform" First, there is no evidence in the article to support the title. Second, I'd observe that while he may not be lying himself, he is clearly pushing the conservative agenda of "no new taxes."

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gandalf48Dec. 18, 12 3:05 PM

Here's how you do it, eliminate all tax breaks and deductions...then give every single person a $20,000 tax deduction so everyone can earn $20k/year tax free. That way you've made up for most of the tax breaks that individuals take anyway and you protect the very poor from taxes...a family with two adults would have the ability to earn $40,000 tax free. After that point you tax every dollar at 20%, that means you can even raise the capital gains rate to 20%. The tax code will remain progressive and tax rates will rise along with income; the tax rate will begin to stagnate around $250k/year so we could add another tax bracket for income above $250k/year at a 25% tax rate. This new system would not only broaden base, increase revenue and create a much more fair system it would also protect the poor and government deductions/credits would no longer be used to hand out political candy (removing special interests from the tax code).

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ronniereaganDec. 18, 12 3:16 PM

I have a better reform idea- stop withholding taxes from pay checks and make each individual actually have to write the check to the government. I promise you that you will feel different about taxation and what value you are getting for this taxation. Think of the frog in boiling water. If you toss a frog into already boiling water- it would jump out immediately. Put a frog into cool water and slowly boil it- you will boil it to death before it jumps out. Taxation is like car-pooling- people support other people doing it.

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pumiceDec. 18, 12 4:04 PM

From the article: "Even economists who aren't conservatives generally say the government should raise revenue by getting rid of tax breaks before it raises rates." I'm guessing Ramesh Ponnuru is using "before" in the sense of "in preference to" in this statement, and I'm wondering if he'd go along with the time order meaning of "before" in this statement: "The government should raise revenue to pay for military actions in Afghanistan and Iraq and to fully fund Medicare Part D before it cuts rates on anyone."

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money2145Dec. 18, 12 4:05 PM

These tax loop holes will never be stopped. Why don't we make the House and Senate pay into SSI and Medicare like the rest of us. That way they will CARE what happens with the laws THEY pass but do not pay into. We have to have CERTAIN TERM's for all of them. This LIFETIME politician has to end. After eight years or so (like the President) then they have to go BACK TO WORK. Any benefits they get that the average person DOESN'T get have to be taken away from them. They are NOT ABOVE us, they are part of us.

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