Friday, February 26, 2010
As Congress readies for the inevitable partisan debate over how best to address the expiring 2001 and 2003 tax cuts, US Senators Ron Wyden and Judd Gregg have introduced legislation that would, if enacted, perform the most widespread clean-up of the US tax code since the tax reform enacted under the Reagan administration in 1986.
The "Bipartisan Tax Fairness and Simplification Act of 2010" aims to clear out the tangled web of nearly 10,000 exemptions, deductions, credits and other preferences that currently clutter the US tax code in a bid to create a simpler and fairer system.
“Senator Gregg and I are demonstrating that there is room for Democrats and Republicans to agree on tax reform,” said Wyden, an Oregon Democrat. “By simplifying the tax code and scaling back tax breaks for special interests, we can give everyone an opportunity to get ahead. Businesses of all sizes will be in a better position to compete and grow jobs. Working families will keep more of their hard earned dollars and everyone will spend a lot less time filling out tax forms.”
"For far too long, our tax system has been overly complicated, burdensome and unfair to taxpayers and to small businesses that are the economic engines of our nation," added Gregg, a New Hampshire Republican. "This investment-oriented proposal will bring us back to common-sense tax laws that encourage people to create jobs and make our nation more competitive."
A key element to the proposal is a flat 24% corporate tax rate, which would bring the US corporate tax rate, currently the second-highest among the major industrialized nations, below the rates levied in key competitors in the European Union, Canada, Australia and elsewhere.
The Senators say that their bill is set out along similar lines to the bipartisan Tax Reform Act of 1986, which funded tax relief by eliminating a number of special interest tax breaks.
For individuals, the bill would:
For business, the bill would:
"This proposal echoes the successful tax reform championed by President Reagan and Senator Bill Bradley during the mid-1980s, Gregg continued. "And it is time that we return to this sort of common-sense, bipartisan approach.”