Tax and Regulatory Reform; Level the Playing Field
Updated: Dec 8, 2017
The tax code is broken. It is based on a patchwork of regulations and economic assumptions that are over thirty years old. We need to scrap the code and rebuild it.
The push by the majority in the House of Representatives for tax reform cannot simply be dismissed as unwise, because the current tax code is indeed broken. The patchwork of the tax code has evolved over decades and is too complicated and does not provide a level playing field for businesses of all forms.
Level The Playing Field
Small and labor intensive businesses bear a higher tax burden because the code treats essentially identical economic activity disparately. A concierge at a hotel employed as a full time employee often yields a tax burden that is different - and often greater - than a online travel agent's contractor-based virtual concierge. An Airbnb host selling short term rentals is treated more favorably than a hotel operator which pays full-time employees wages and benefits. This must be improved upon to yield similar tax regimes for similar activity. Doing otherwise penalizes conduct by businesses by maintaining an uneven playing field.
Current Tax Proposal is Lopsided
The tax proposal currently pending before the Senate is problematic because it attempts to shift additional burdens to tax payers who are least able to bear them. Universities, research institutions and students all suffer under the current proposed plan. Moreover, the current tax plan improperly favors low regulation states by eliminating the credit once available for state and local taxes. Middle class taxpayers also get hit through a system of expiring tax credits, which will phase in over time, while the pass-through entity taxation cap -- a gift to the extremely wealthy -- does not expire.
Bad Tax Policy
This is the problem when tax policy is rendered without bipartisan and broad reaching dialogue from a wide spectrum of lawmakers from varied political backgrounds. Unfortunately, today's Washington appears destined to endure large scale policy pendulum swings based on the set of politicians in charge. A better approach would be to determine and implement longer term solutions achieved through bipartisan discussion and debate.