It’s High Time for Tax Reform, but the Republicans Are Doing It Wrong

by Veronique de Rugy | Mar 14, 2017   ()

Complying with tax laws shouldn't be complicated or punishing to economic growth. Unfortunately, the current tax code is anything but simple, and the price tag of that complexity is enormous. In particular, our high tax rates distort business decisions and are destructive to economic growth. According to an Internal Revenue Service report, corporations alone spent $104 billion complying with the tax code in 2012. That's a ton of money, especially considering that corporate tax revenues are only about $500 billion a year.

In other words, it’s high time for tax reform. Unfortunately, the House Republicans may be jeopardizing the first opportunity they have had in over 30 years to implement desperately needed tax changes by insisting on one very problematic tax feature on the corporate side called the border adjustment tax. The reform would slap a 20 percent tax on imports to the United States while exempting exports. For the proposal to not become a protectionist tax increase, proponents assume a large and unrealistic strengthening of the U.S. dollar. Read More

Source: The Fiscal Times

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