2016 Republican frontrunner Donald Trump has released his tax plan for his campaign and it’s being met with both praise and criticism. While some conservatives are delighted over the drastic plan that calls for significant cuts, the plan is also being met with criticism as some allege it is fiscally irresponsible.
The plan calls for significant tax cuts that are likely to affect millions. This is terrific news at a time when government is too large and too inefficient. The plan calls for eliminating federal income taxes on individuals earning less than $25,000 and married couples earning less than $50,000 a year.
The plan also calls for reducing the corporate tax rate from 35 percent to 15 percent and lowering the highest income tax rate from 39.6 percent to 25 percent.
These are steps in the right direction, but fail to address the problem of bloated government bureaucracy. The IRS is a quagmire of inefficiency and has been, in recent years, used as a cudgel to thwart legitimate political expression.
It has to go. Rip it out roots and all. Lowering the tax rate is a great gesture, but we cannot take a “reformer” seriously unless he or she swears to, at the very least, slash government bureaucracy significantly and that starts with a pledge to devastate the bureaucracy that exists solely to leach off of the American people.
Secondly, we need a streamlined tax code. These cuts are great, but they still work within the confines of the existing, broken system. A flat tax is needed for fairness and a flat tax is needed to ensure efficiency.
Taxes are a necessity (especially with an $18 trillion+ debt hanging over our heads), but a simplified tax code enables the creation of a modest revenue-collection agency. There are many options available: a flat tax, a fair tax system, Herman Cain’s 9-9-9 system or even a national sales tax that bases our taxation upon consumption. There, a homeless man buying a soda and a billionaire buying a yacht are both contributing to the tax system.
This plan lets more Americans off the hook. We need more people in this country paying taxes, not less. These taxes should be reduced; however, currently, we have a system where one half of the country is paying the taxes for both halves of the country. Augmenting the portion of Americans who will not be paying taxes is a step in the wrong direction.
That is why, again, I (and many economists) favor a simplified tax system that includes everybody. A tax applied evenly or even a tax based upon consumption rather than production is the surest way to strike the correct balance of efficiency and fairness.