In our view: A plan worth considering

June 20, 2009 10:13 pm

— Just what sort of tax system does the United States need to promote economic growth and fund government operations?
We’re not sure, but we think the Fair Tax Plan is one worth studying.
Certainly there are pros and cons to the plan — as in all plans. But the Fair Tax Plan has caught the attention of some. A rally for supporters of a nationwide sales tax to replace the current income taxes drew thousands of residents to Columbia last weekend, and the movement appears to be gaining steam.
A similar plan at the state level attracted enough support that a resolution calling for a statewide vote was approved by the Missouri House of Representatives in this past session. It died in the Missouri Senate for lack of a vote at the end of the session, but you can be sure it will be back before legislatures in the next session.
Upending our tax system will not be without its challenges, especially if government is considered the be-all, end-all for economic policy.
First of all, the U.S. Tax Code is an exercise in social engineering, giving special treatment for certain segments of the population through tax shelters and exceptions. It is a highly complex document of hundreds of pages and millions of words that are virtually impossible for the average taxpayer to comprehend. The people have elected the politicians, some of whom have seen taxes as more than a necessity to provide basic necessities for government. Taxes cover programs that encourage re-election of certain individuals by a dependent constituency, and for achieving social-engineering objectives.
Certainly the idea of never having to file a federal or state tax return again is appealing. It’s the trade-off of being taxed on consumption that makes some hesitate. Products and services would be included such as nursing home fees, medical and legal services, rent, health insurance and college tuition.
The Fair Tax Plan is a whole new way of thinking. That’s why we’d like to see Congress approach the proposal with an open mind to see if ditching the federal income tax code is a step this country should take.
We look forward to further debate on the plan. Tax reform of some type is long overdue.