Fundamental Tax Reform Is Needed Now

• A Drain on the Economy: High marginal tax rates and a battalion of tax distortions discourage productivity, slowing the rise in wages and economic growth and making it difficult for businesses to compete globally.

• Far Too Complicated: The current tax system is too complex. The income tax inflicts a multitude of rules and exceptions that lack transparency and fairness.

   

  Pro-Growth: The tax system should be economically neutral, not distorting economic decision-making of savers, investors, and workers.

• Revenue Neutral: The new tax system should be revenue neutral, raising as much revenue as current policy—about 18.5 percent of the economy.

• Incentives Change, not Burdens: The tax system should be distributionally neutral, leaving the tax distribution unchanged as much as possible.

• The New Flat Tax Is the Remedy: The New Flat Tax, as outlined in Heritage’s ‘Saving the American Dream’ plan, would replace today’s convoluted tax system with a simple, neutral, and transparent tax system that would allow America to achieve its full economic potential.

Easy as One, Two, Three

-Heritage.org