Just in time for Tax Day, PPI this week released a study calling for the most ambitious overhaul of federal taxes since 1986. We expect this plan, which won bipartisan backing on President Obama's Fiscal Commission, will be at the center of this year's struggles to forge a comprehensive and balanced deficit reduction package.
"Less is More: The Modified Zero Plan for Tax Reform" was written by PPI Senior Fellow Paul Weinstein and Marc Goldwein of the Committee for a Responsible Federal Budget, who helped to shape the plan as advisers to the Commission. They trace the development of the plan, which eliminates tax expenditures and uses the savings for two purposes: sharply reducing corporate and individual tax rates, and cutting future budget deficits. This proved to be the Commission's key political breakthrough, as several conservative Republican Senators defied their party's dogmatic stance against raising any additional revenue to close the federal government's yawning fiscal gaps.
It's a lucid, readable account of how the bargain was struck, and how it could yield a federal tax system that is simpler, more progressive, and more conducive to economic innovation and growth. You'll be hearing a lot more about it in the months ahead.