Flat Tax: A Freedom Tax

Fire of Liberty

The Economist has devoted its April 14th, 2005 issue to the Flat Tax, read here. It's about time that the magazine that is devoted to economics and financial growth throughout the World pays homage to the most simple income tax system ever devised. While a considerable amount of people like John Linder and Neal Boortz argue for the Consumption Tax, I'd argue different. Unlike the Flat Tax with its set tax rate which can be calculated in matters of minutes and mailed on a 3X5 card, the Consumption Tax calls for the scrapping of the whole tax system and the IRS (which requires the repeal of the 16th Amendment+ this requires 2/3 majority in both houses of US Congress & 3/4 majority of States) and it's just too darn confusing for most people to understand yet explain. If you want to "simplify" the tax code then a Flat Tax is the way to go. Just read what the editorial board at The Economist has to say about the implementation of this simple tax System:

Though it is impossible to be precise, that direct burden is almost certainly as nothing compared with the broader economic costs caused by the government's interfering so pervasively in the allocation of resources. A pathological optimist, or somebody nostalgic for Soviet central planning, might argue that the whole point of the myriad breaks, deductions, allowances, concessions, reliefs and assorted other tax expenditures that clog rich countries' tax systems—requiring total revenues to be gathered from a narrower base of taxpayers at correspondingly higher and more distorting rates—is to improve economic efficiency. The whole idea, you see, is to allocate resources more intelligently. Yes, well. Take a look at the current United States tax code, or just at one session of Congress's worth of tax-gifts to favourite constituencies, and try to keep a straight face while saying that.

I for one would recommend that President Bush's tax commission look at the Flat Tax as the best way to reform the bloated tax system that we have created. If we could simplify our tax system, more people would be able to keep more of their money and wouldn't have to stay up at all hours of the night looking over receipts trying to fill out their returns on April 15th. It would make life more simple for us. (Don't know what that means to H&R Block though).