Time to Sunset the Tax Code

This is tax week, the week we’re reminded how utterly insane our tax code is, at over 70,000 pages long. It would take over a year to read it at 2 minutes-per-page for forty hours a week. Yet there hasn’t been a major tax reform in thirty years. So we at Let Freedom Ring have developed a novel strategy: pick a date to terminate the current tax code far enough into the future to allow plenty of time to develop a simpler and fairer one from scratch, yet soon enough to force action now. We picked December 31, 2019. That would give the Congress about three years to design a replacement tax system. Giving Congress any longer would only make the final product worse – more complicated, more difficult to understand and filled with too many tax preference items and special deals and loopholes devised by lobbyists. And any shorter would introduce too much uncertainty into the financial markets and the general economy without adequate preparation time.

You see, every special deal and loophole has the effect of shifting some of the tax burden away from the well-connected and onto the shoulders of the average, honest, hard-working taxpayer who doesn’t have access to high-priced lobbyists, tax accountants and lawyers.

Just to state the obvious, you don’t need 74,000 pages to implement a simple, fair tax code. And if your starting point for tax reform is a 74,000 page document, you’ll only be nibbling around the edges of a monstrosity. Far better to start from scratch.

At Let Freedom Ring, we created a project over a year ago that we call Sunset the Tax Code. There’s a bill in the House of Representatives that would accomplish almost exactly what we proposed. It would cause the entire tax code, except for Social Security and Medicare, to expire on December 31, 2019. It’s called HR 27, and it was introduced in January of last year by Virginia Republican Congressman Bob Goodlatte, Chairman of the House Judiciary Committee. Because the Judiciary Committee is not the committee of jurisdiction for tax policy, it was referred to the House Ways and Means Committee, which is the House’s tax-writing Committee. Then we began working with grassroots supporters and one-on-one meetings with legislators and their staffs to enlist co-sponsors of HR 27. There are now 130 of them. That’s six more than one important threshold – what’s called the "majority of the majority." There are 247 Republicans in the House, so a majority of the would be 124, and we have 130. There’s a tradition in the Republican leadership of the House – some call it a "rule" – that when a majority of the House is opposed to a bill, leadership should keep it from moving onto the House floor. The corollary is that when a majority of the majority is in support of a bill, it deserves to go to the House floor.

HR 27 intentionally avoids making changes to Social Security and Medicare. That’s a political calculation, and probably a correct one. Reform of those two enormous programs should be undertaken separately.

By not specifying exactly what type of tax system should replace the current one, HR 27 has the potential to unite the supporters of all the different replacement schemes in favor of ending the current system first. That then sets the stage for a major, national debate on what the replacement system should look like. With a deadline looming, the Congress will be forced to act. The bill even has a provision to make it hard to extend the deadline. HR 27 will thus be a catalyst, a strategy that promises to break the legislative logjam that has prevented serious, broad-based tax reform from moving forward. I invite you to learn more about this game-changing strategy by going to www.SunsetTheTaxCode.com. It’s our best chance to make our system of taxation simpler, fairer and more growth-oriented.

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