"1. Shred the entire 2,700 page tax code and replace it with a 25-page code. As I explained in The Fetid Swamp of Tax Reform (November 10, 2017), the 2,700 page current tax code is a complexity thicket designed to hide tax breaks and subsidies for big political donors.
Politicos give lip service to simplifying the tax code for PR purposes, but no politico actually wants radical simplification because this would eliminate the biggest grab-bag of political favors available to pass out to big donors.
Though radical simplification is politically impossible, it's the first and most important real reform.
2. Replace the entire convoluted mess of income tax for the bottom 99.5% with transaction taxes collected at the point of transaction. A transaction tax is similar to a value-added tax (VAT) or sales tax, but it's radically different in key ways: a transaction tax is levied on financial transactions, not just sales.
A transaction tax would be levied on every high-frequency stock trade, every loan that was sold, every financial transaction anywhere in the U.S. or any transaction anywhere in the world involving a U.S.-based entity or asset...
A transaction tax eliminates all tax returns, all accounting for income, deductions and expenses, and correlates to wealth/income. The working-poor household would pay a transaction fee when they buy something at a dollar store, but the fee would be much less than current state sales taxes. The point of the transaction tax is that it includes all the transactions of the wealthy class that aren't simple purchases of goods and services.
To insure a progressive tax structure, financial transactions above certain thresholds of size and frequency would be taxed at a higher rate...
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