Principles of Reform
Supporters of fundamental tax reform have agreed on four basic principles:
1) Lowering and flattening marginal rates
2) Moving towards full expensing of business investment
3) Reducing or eliminating the double taxation of dividends and capital gains
4) International tax reform
These four goals will move us towards a simpler, fairer, flatter and more honest tax system. Reducing marginal rates makes the tax burden more equitable and creates incentives for people to work. As the income tax rate cuts signed by President’s John F. Kennedy and Ronald Reagan proved, cutting marginal rates can jumpstart the economy and increase wealth, leaving both individuals with more money and government with more revenue.
Fully expensing business investment will give companies the resources needed to grow and create jobs. Eliminating double taxation on dividends and capital gains means the government taxes you once and then lets you decided that to do with what you have left—rather than penalizing those who decide to invest. And in a globalize economy, a tax code that does not penalize American businesses and workers is needed if they are to stay competitive.
The ultimate goal is a simple tax code that is consistent with our values. A better code would reward hard work, encourage investment, reflect our fundamental belief that individuals can spend their own money better than Washington can, and take power out of the hands of the lobbyists. This new system, by harnessing the power of freedom, would make the American economy stronger.
Simply put, our tax system should collect revenue to pay for the functioning of government in the simplest, fairest, and most transparent manner possible.
