Income Tax Is Beyond Reform PDF Print E-mail
Written by AIER Research Staff   
Friday, 08 May 2009 00:00

President Obama’s proposal to curb offshore corporate tax havens is just the latest example of what has become a permanent feature of the American political landscape: The drive to reform the tax structure. Both major parties constantly tout changes they say would make the system better for the economy, more equitable, or just plain easier to follow.

What all these proposals and the debate that surrounds them miss is that the income tax is beyond reform. The problems begin with the fundamental difficulty in accurately defining both income and taxable income. And they multiply with a complex tax code that is often designed to reflect motives other than evenhanded taxation.

AIER took a close look at the irreducible drawbacks of the income tax more than 10 years ago in the September 1996 Issue of the Economic Education Bulletin. Please visit the AIER online archive to read the article entitled “Why the Income Tax Will Always Need Reform and Why it is Beyond Reforming.”

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Comments (2)
Tax "Reform"
2 Saturday, 09 May 2009 14:39
Blitzen bBaster
As Bill Cosby would say, "Riiight"
I am reminded of the old IBM System 360 operating software. After a relatively short time of bug fixes it went incurably unstable. Each fix caused a new bug. So it is with the tax code. Each fix creates a new opportunity for idiocy or mischief - usually both.
INCOME TAX REFORM
1 Friday, 08 May 2009 11:00
R JALLO
While I can agree that the income tax system is far from being perfect...it appears that we will be stuck with this method for years to come. The problem that the Obama adm. is seeking to resolve is the offshore incorporation to avoid paying U.S. income tax on income that was primarily made in this country but because of incorporating in an offshore location they are exempt from paying any or very little taxes. Interesting emough many of the companies involved in this scam are involved directly or indirectly with insurance or re-insurance business. Is that any surprise...insurance companies have been scamming the general public for years...and continue to do so...sometimes with the blessing and knowledge of Washington. evernytime there is a disaster a quick research will reflect how the insurance industry is quietly working to avoid paying policyholders what they are entitled to and what was promised by the insurance compaines when they sold the customer the policy. Just a few years ago Stanley Toolworks was endeavoring to relocate their Corporate office to avoid or reduce federal income tax...apparently they were inunderdated with complaints from shareholders, employees and citizens which caused a reversal by the company.

I guess any tax is fair as long as the other guy is paying it!

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