Tax Overhaul

Wyden's Fair Flat Tax of 2005 proposal gets some good press!

[it] would tax all income from whatever source at the same rate, close thousands of loopholes, and simplify everybody’s tax return into a one-page form.

...It’s been 20 years since the last tax overhaul, when then Democratic Sen. Bill Bradley worked with the Reagan administration to slash the tax rates and close loopholes. Wyden conferred with Bradley, who told him the case for reform is even stronger now than it was in 1986 because globalization has tightened the squeeze on the middle class.

Wyden would reduce the current six tax rates to three—15, 25 and 35—and get rid of “all the glop,” the 17,000 special-interest provisions added since ’86. He wouldn’t raise the top rate, which should calm Republican fears about class warfare, and he would preserve popular deductions like home-mortgage interest and charitable contributions. When Wyden calls some of his wealthier constituents to tell them he wants the same treatment for wages and investment income, “You can hear the pause at the other end of the line.” After he explains that it’s not really fair to tax unearned income from investments and stocks at a lower rate than hard-earned wages, “There’s another long pause before they say, ‘I can’t argue with that’.”

...Bush had intended to make tax reform a centerpiece of his second term, but he is too weakened to bring his party to any consensus. Wyden thinks his plan could attract bipartisan support. “A Republican senator told me he didn’t agree with me on capital gains,” Wyden told NEWSWEEK. “But he said it ought to be a requirement every 20 years to clean up the code. He laughed and said, “Then the lobbyists can come back and fill it up again.”

Tags: Wyden, tax reform, taxes