When we designed our Complete Flat Tax in our book “Return to Prosperity,” we came up with this business tax system with no deductions, simple as can be, and the lowest rate just about anywhere in the world.
Hello. That’s exactly what you want in a good tax, isn’t it?
Almost every economist will agree that the right way to tax businesses is on their income minus their allowable expenses.
The crux of the complaint here is that the Paul and Cruz tax plans are too efficient and too pro-growth and thus raise too much revenue.
Let’s go back to basics.
The sole reason we need taxes is to raise the requisite revenues to fund government. (The left wants taxes to punish the rich, but that’s the subject of another column.) The U.S. government should collect taxes in the most efficient way possible so as to do the least damage to the economy.
Criticizing the Cruz and Paul VATs based on worries about providing too much revenue to government is like arguing against cutting the capital gains tax rate — because every time we cut that rate, the feds get more revenue.
Click here to read more.
To learn about supply-side economics, click here to visit the Laffer Center.
Photo Credit: TaxRebate.org.uk