Saving Freedom: on Tax Reform

Jim DeMint: Sales tax & tariffs ok; income tax confiscates wealth

The first income tax was 1% of all income more than $3,000, and politicians assured the people the tax would never exceed a few percentage points. The framers avoided income taxes because they knew taxes on personal property would quickly become discriminatory and a means of confiscating wealth. Transactional taxes are "blind" to any preferences and simplify the tax code by keeping it singularly focused on raising revenues rather than shaping society.

Jim DeMint: Half of all Americans now receive income from other half

My concern about America's growing dependence on government was the reason I ran for Congress. Dependency was not your typical "get them on their feet," crowd-pleasing speech material. Eyes glazed over when I spoke about dependency.

Social Security, Medicare, and Medicaid make up 53% of all dependency-related federal spending. These programs will increase to nearly 65% over the next two decades as baby boomers retire.

The larger the number of dependent voters and the fewer who pay taxes, the less likely politicians will have the political courage to stop the growth of dependency-creating programs. The majority of voters are already more interested in federal spending than tax cuts.

Paul Ryan: Road Map: simplified two-level flat tax

The new, simplified tax code eliminates nearly all existing tax deductions and exclusions, but it allows generous standard deductions and personal exemptions. Individuals receive a $12,500 deduction. Personal exemptions allow $3,500 for each family member. Tax return could be done on a post card.

The Road Map plan would not require major changes in the current income tax system now collected by employers. People who don't like the simplified tax alternative could stay with the current tax system. This gives people a choice, and the total tax revenue to the government would be the same. Who could complain about that?