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Roy Maynard: Early Returns

Posted on Sunday, April 13, 2008
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Candidates Shy From Commitment To Tax Reform
ROY MAYNARD
Tuesday's federal income tax deadline - the dreaded April 15 - has me lamenting one of the lesser-publicized defeats in the recent primary races: real tax reform.

Of the three remaining candidates - Republican John McCain and Democrats Barack Obama and Hillary Clinton - none have expressed a real commitment to substantive tax reform.

"Hard-working American families need lower taxes," John McCain's Web site says.

While a tax cut is always a nice thing, it's not fundamental tax reform.

Likewise, Sen. Clinton focuses on lowering some taxes, but only for the middle class (which somehow I suspect I won't qualify for, once her new tax rate schedules are unveiled). And Obama's focus on "fairness" unvaryingly means eliminating deductions and collecting more taxes.

Local attorney Sean Healy agrees on the need for tax reform.

"Our chances of tax reform under Clinton or Obama are excellent," Sean told me recently. "They are determined to eliminate every remaining loophole that allows us to keep any of the government's money."

Sean is a proponent of the "Fair Tax," or a national sales tax.

"The whole concept of an income tax is flawed," he says. "Any tax discourages the activity which is taxed. Do we really want to discourage people from working and producing? The national sales tax applies to spending, and therefore exempts all savings."

He answers some of the stronger arguments against a sales or consumption tax.

"People complain that a sales tax would eliminate the deductions for mortgage interest and charitable contributions," he says. "But charitable contributions aren't purchases, so that exemption could survive. And I would trade a blanket exemption on all savings and investment for the mortgage deduction with no hesitation."

There are fundamental philosophical problems with the present system.

"Many of the current income tax laws are intended to encourage or discourage certain behavior, rather than to generate revenue," Sean says.

This means the income tax destroys a large portion of our freedom, on purpose. I see this as a bad thing. Obviously Congress does not.

The Fair Tax would also help keep politicians honest, he adds.

"Right now your taxes can be increased in many ways, by limiting deductions, by adjusting a few words in the volumes of tax laws or by scrutinizing your tax return a little closer," he says. "It would be a lot harder for politicians to raise taxes if the only way to do so was to actually increase the tax rate."

Sean seems less depressed about the prospects of tax reform than I am.

"I refuse to give up hope that the system can be reformed," he says. "Everyone who actually pays taxes can see the need for reform. The problem is that we have to depend on action by people who would not benefit from reform. Politicians would lose power if the government shrank."

He also holds out hope that at least one presidential candidate can be convinced.

"So far McCain has talked about adjustments to the current system, rather than scrapping it and replacing it with something better," Sean notes. "He seems open to suggestions regarding the economy. If he surrounds himself with the right people, maybe good things will happen."

Sean Healy will make a presentation about the Fair Tax to the Tyler Young Republicans when they meet at 6:30 p.m. May 13 at the Smith County Republican Headquarters, 3923 S. Broadway Ave.

Early Returns is the political observations column of staff writer Roy Maynard, who can be reached at 903-596-6291 or at roymaynardtmt@gmail.com.

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