Washington, D.C. - When President Abraham Lincoln signed the Revenue Act of 1861 into law, the income tax was born. At the time it was twenty-one pages and called for a flat, three percent tax on annual income over $800.
August 5 marks the 150th anniversary of the tax code. In the intervening years, the tax code has grown to 72,536 pages and is anything but flat if you ask Congressman Jack Kingston (R-GA).
“To be blunt, it has let itself go,” said Kingston. “We tried not to hurt its feelings but it is time for an intervention. We need a more simple and fair tax code. One that works for all Americans and which encourages economic growth and prosperity. In doing so, we can reignite the American economy and build a better future for our children and grandchildren.”
Kingston is not alone in his belief that tax reform would stimulate the economy. Harvard Economist Dale W. Jorgenson estimates that tax reform could boost the nation’s economy by more than $5 trillion.
For Kingston, the ideal tax system would be the Fair Tax which would repeal the tax code in its entirety to impose a revenue-neutral sales tax on all new goods and services at the point of final purchase for personal consumption. Each year, the proposal would provide for a universal rebate in the amount equal to sales taxes on the purchase of necessities.
The Fair Tax has gained nationwide attention and was the basis for a bestselling book by former Congressman John Linder (R-GA). Kingston has cosponsored legislation to make the system the law of the land.
While he has not cosponsored the Flat Tax, Kingston supports the concept on the basis that it simplifies the tax code. Under this proposal, the complicated system of multiple rates and deductions would be scrapped in favor of one based on a single rate to be paid by all workers. The system would do away with the 893 forms currently required under the current tax system and would require just one form.
“Our cumbersome tax system makes America unappealing for businesses and jobs,” Kingston said. “It is a drag on our economy at a time when we can least afford it. So whether you support the Fair Tax or the Flat Tax, we have got to get this discussion moving.”