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Tax professionals aren't worried about tax reform getting too radical

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The complete Internal Revenue Code is more than 24 megabytes in size and would take up more than 7,500 pages, but several Republican presidential candidates are talking about slashing it to mere sentences.

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Last month at the Statehouse in Columbia, Texas Gov. Rick Perry held up the simplified tax form that he says Americans would fill out if he were elected president. He is calling for flat taxes.  Associated Press
Associated Press
Last month at the Statehouse in Columbia, Texas Gov. Rick Perry held up the simplified tax form that he says Americans would fill out if he were elected president. He is calling for flat taxes.

Herman Cain has become famous for his 9-9-9 plan, a policy with which citizens would pay 9 percent sales tax, 9 percent individual tax and 9 percent business tax.

Individuals at or below poverty level would pay no individual tax, Cain announced last month in a Detroit campaign speech.

Although the idea seems straightforward, using a hatchet on the tangled tax code isn’t likely to be that easy, according to Augusta accountant and politician Jerry Brigham.

“I think it’s going to be easier said than done,” he said.

Sen. Ron Paul wants to eliminate the concept of income tax from the U.S. completely; he would have a 15 percent corporate tax.

Texas Gov. Rick Perry says that he would enact a 20 percent individual flat tax and 20 percent corporate tax.

Perry also said he would eliminate the majority of itemized deductions, streamlining the tax-filing process.

Paul Wade, a partner at Serotta Maddox Evans in Augusta, said that promising to eliminate or highly simplify the code might be too much for candidates to promise.

“The current system is extremely complicated, but even if they tried to simplify things, it’s probably just going to make things more complicated,” Wade said. “It wouldn’t be nearly as simple as it’s being portrayed.”

Brigham said that some simplification is definitely in order. He has been in taxes for more than 20 years.

“It’s getting more and more complicated,” he said. “It’s always been complicated, but now you have to have special software to even know how to fill out a form.”

U.S. legislators aren’t known for their quick action, he said, and that’s what would stop the dramatic tax reform even if one of the Republican candidates were elected president.

“It’s going to be a slow-moving change, not a radical change,” Brigham said. “And it would have to be revenue-neutral somehow, just in order to keep operating the country.”

If Cain’s 9-9-9 plan were to wind up as national policy, or Paul manages to eliminate income tax altogether, Wade and Brigham’s trade could be in danger of becoming obsolete.

That possibility doesn’t have them worried, however.

“It’s not going to happen,” Brigham said. “It just isn’t.”

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Fundamental_Arminian
1871
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Fundamental_Arminian 11/13/11 - 07:38 am
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It's sad how our tax code has

It's sad how our tax code has crippled the accounting profession. Before income taxes and the IRS, accountants were efficiency experts. They focused on eliminating waste and cutting unnecessary costs. The resulting savings benefited companies and consumers alike.

Now accountants must devote all their time to keeping up with our ever-evolving tax code. The result is costly, government-mandated busywork and a tremendous waste of brainpower. Meanwhile, our companies grow less and less able to compete with industry overseas.

Given the large number of people in the tax-preparation business, and the approximately 47% of the population who pay no income taxes, our nation has probably passed the point of no return. Sooner or later, we'll hit bottom, and it won't be a soft landing.

david jennings
625
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david jennings 11/13/11 - 07:36 pm
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Of course there is no quick

Of course there is no quick fix but please, lets start somewhere. The current system has stopped working for the people, it is time for a change. Everyone is going to have to make sacrifices, the party is winding down. The working folks are doing thier share, it is time for the government to start doing thiers. Reduce spending by eliminating waste, tap our own oil reserves, do away with needless regulations that inhibit productivity. Do as I do, if I can't afford it, do without it, it's not that hard.

Craig Spinks
818
Points
Craig Spinks 11/14/11 - 02:54 am
0
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FA and (D)j make very good

FA and (D)j make very good points.

And, in a spirit of levity(Jack Batson says that I take life too seriously.), in addition to the FairTax, the flat tax, the value-added tax and the sales tax, might I propose the caliper-dependent Fat Tax.

The Fat Tax would levy a a tax based upon the extent to which a person's BMI exceeds the American Medical Association's recommendations for body-mass index. The tax rate would be determined by the GAO and recommended to Congress for its approval and to the POTUS for signature as required for current tax measures..

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