Fix The Debt

In her Annual Report to Congress, the National Taxpayer Advocate, Nina Olson, identifies the complexity of the tax code as the “most serious problem facing taxpayers.” She calls for fundamental tax reform that simplifies the tax code.

Specifically, she recommends addressing the myriad deductions, credits and other tax breaks known as tax expenditures that are essentially spending through the tax code. However, unlike normal spending, these tax expenditures are rarely reviewed for relevance and cost effectiveness. The report states:

In general, this means Congress should look at each provision in the code and ask questions like: ‘Does this government incentive make sense?’; ‘If it does, is it better administered through the tax code or as a direct spending program?’

The chairmen of the tax-writing committees in both the House and Senate have promised to pursue major tax reform this year. The Simpson-Bowles plan proposed tax reform that would eliminate most tax expenditures.

Not only would it simplify the tax code, but also reduce the deficit. Check it out here.