Skip to main content

Machiavellian Defense for a Flat Tax


There are a lot of different ideas for tax code reform supported by libertarians. Flat tax. Fair tax. No income tax at all. And all of these proposals are opposed by some libertarians as well. It's a tough issue. Do we improve this system we rail so loudly against through some sort of gradualism? Or does supporting one of these "slightly better" systems mark us as supporters of legalized theft?

Now, most of the arguments for tax reform stem from some semblance of "fairness". A progressive tax code isn't fair because it punishes the best and brightest. And our present tax code is also so confusing that only those who can afford good lawyers can get around it.

Let's think pragmatically about what some sort of flat tax would encourage.

The government is always looking to increase their tax revenue. They expect budget increases the same way you expect a small salary bump at your yearly review - regardless of the fact that your company lost business and cut employees this year. You want it. You expect it. And so do they.

But with a flat tax, they can't just pick on the winners anymore. In order to get more revenue, their best tactic would be to incentivize overall growth. Lower trade barriers. Lower the costs of doing business. Encourage real growth.

They win. We "win". The pragmatic in me wants it. The cynic in me knows that even if it passed, they'd create new "excise" taxes to take more from the winners. The flat tax might not stay flat for long.



By: Eric Olsen, Regular Columnist
Articles | Author's Page | Website

Popular posts from this blog

Thomas Sowell Returns

By: Thomas Winslow Hazlett Reason

How To Cripple The Real Estate Market In Five Easy Steps

If the government and the banks had just allowed real estate prices drop to market equilibrium, we'd be out of this mess and housing would truly be affordable. But the government is determined to artificially prop up housing prices, whatever the cost to the economy. If you were head of Central Planning (howdy, Ben!) and were tasked with crippling the real estate market, here's what you would recommend. Choke the market and banking sector with zombie banks... Have the central bank (the Federal Reserve) buy up $1 trillion in toxic, impaired mortgages... Lower the rate that banks can borrow from the Fed to zero, and then pay the banks interest on all funds deposited at the Fed... Try to prop up the housing market by giving poor credit risk buyers loans with only 3% down... Load young people up with the equivalent of a mortgage in student loans... OK,let's see how our Organs of Central Planning are doing: check, check, check, check, check: a perfect score! they're...

Tax Bill Is Beginning of Formal Debt Criminalization

The noose is tightening on liberty. The United States Congress is steadily headed to a place where those who owe money to the US government shall be treated criminally. This phenomenon is advancing domestically and now, increasingly, internationally. The first shot in this latest campaign took place in 2010 when US President Barack Obama signed into law The Foreign Account Tax Compliance Act. It demanded, basically, that foreign banks withhold up to 30 percent of the income that an American abroad might earn. This bill isn't working so well because overseas banks are not cooperating (a state of affairs that was certainly expected). Thus, there is a need for something else: Senate Bill 1813, recently introduced by Senator Barbara Boxer (D-CA). This bill, in part, states that taxpayers with unpaid taxes over US$50,000 may find their passports confiscated. This isn't criminal per se, but the IRS has recently made noises about "sharing" information with police a...
–––As Featured On–––