Howard Gleckman thinks the Bush tax cut debate is a distraction. The questions he wishes Obama would pose to Congress:
*Should the income tax continue to be the foundation of our revenue system? If so, do we want to raise rates while protecting hundreds of billions of dollars in special interest tax subsidies. Or should we reprise the 1986 Tax Reform Act, where we broadened the tax base by eliminating many special provisions and lowered overall rates. It seems like a good idea to me, but let’s debate it.
*Is the income tax fixable at all, or is it so broken that we’ll need to replace it, or supplement it, with a Value Added Tax or some other consumption tax? Such a change would have profound implications, not only for the budget, but for spending, savings, and investment. And it could create a very new set of winners and losers than under the current tax system.
*What is the role of Social Security and Medicare taxes in a fair and efficient revenue system? With almost no discussion, this year’s health law fundamentally changed the nature of the Medicare tax by imposing it [on] investment income, rather than just wages (starting in 2013). Perhaps we want to talk about this one some more.
If we had a rational political system and a viable opposition party, it would be lovely, wouldn't it?
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