Tax hooey from the GOP

Word is that one of the Republican priorities for Bush's second term will be replacing our current progressive income tax with a "flat tax." For the uninitiated, a flat tax is where everyone pays the same rate regardless of your income. We currently have a progressive income tax. In a nutshell, the progressive tax system taxes those who can afford to pay more at a higher rate. The more you make, the higher your tax rate.

The rationale for the progressive tax is that it is more fair to people who aren't rich - the less money you have, the more important each dollar of it is. If you are just scraping by, any additional loss of income cuts into your basic needs like food and shelter. As you get richer, higher taxes may only mean that you may have to put off upgrading the hot tub on your yacht for another year.

The Republicans are pushing up hill on the flat tax. Many people understand that losing 15% of one's income to taxes doesn't hurt as much for a rich guy as it does for someone a few rungs down the ladder. And, in absolute terms a flat tax would result in the middle class paying more, and the rich paying less, than they do now.

Now the GOP has shifted to a new theme: a flat tax is simpler. Our current tax code is so complicated and so filled with loopholes and perverse incentives that the whole thing needs to be scrapped and replaced with one simple flat tax where everyone pays the same exact rate. Just figuring the current tax code out, they say, is a burden to society and one of the reasons so many people evade taxes.

Now, where does The Minister of Things stand on this? Well, given that most major US corporations have their own lobbyist-edited chapters in the tax code, and that you get tax incentives to buy an environment-despoiling Hummer over a nice efficient wagon, and there are countless loopholes that shift the tax burden off the wealthy and onto average people, I'm all for scrapping the whole thing.

But here's the catch, scrapping all the loopholes and creating a flat tax are two completely different things. We could just as easily scrap the loopholes and nonsense, but keep the progressive tax part of it. There is no reason simplifying the tax code and ending the loopholes has to result in a flat tax.

In fact, the least complicated part of the current tax code is the progressive part where you find your income on the nice little table to see what bracket you're in and how much you owe. The whole debate is just a ruse to hide the real purpose of the flat tax, shifting more of the tax burden off of the wealthy.

So, out with the old progressive tax and in with the new flat tax. But the Hummer, the Enron chapter of the tax code, the off-shore tax shelters, the armies of lobbyists? That stuff all stays. Guaranteed.