It's been more than 30 years since the United States tax code saw any reform. There is an opportunity for Congress to do that now. We hope they do and in a way that is fair to all taxpayers.
Taxpayers spend 6 billion hours each year preparing individual tax returns. The tax code is over-burdensome, costly and too complicated for anybody to file their taxes without the use of software or a professional tax preparer. That shouldn't be. We're glad Republicans in control of Congress are beginning to devise reforms.
The fairest and most effective tax system is one with low rates across a broad base. And given the current state of the economy, as well as the political environment, we believe the best tax reform is one that is revenue-neutral, as opposed to one designed to starve government or raise a ton of new revenue.
Simplification of the tax code is a logical first step. The current system has too many tax brackets and far too many credits and deductions. The IRS page for individuals lists 50 different credits and deductions. There are more if people are self-employed.
Eliminating many of the credits and deductions would allow for doing away with some of the seven current tax brackets, reducing them to three and lowering marginal rates.
We understand this approach will come with short-term pain as some people and interests lose credits and deductions. But the change comes with the long-term gain in the form of lower marginal rates. That benefits people as they become more upwardly mobile.
Opportunities for comprehensive reform of the tax code do not present themselves often. With a stable economy, low unemployment and low inflation, President Trump and Congress have an excellent opportunity to provide the country with much-needed reforms to the tax code.
Let's demand they present a plan that works for the betterment of the country as a whole.
Editorial on 09/24/2017