CA Governor Jerry Brown is pushing for serious budget cuts and a tax extension plan, but Republicans are blocking his efforts to bring his tax plan to a June vote. They’ve seen what happens to Republican politicians who vote to raise taxes!
Without such a vote, more cuts will be needed. Instead of trying to get Californians to vote for another “temporary” tax extension, why not try an innovative proposal he once believed in. To be specific, if Gov. Brown wants to get Republicans to sign on to giving Californians a choice that will help balance the budget, let him propose a flat-tax like he did in his 1992 Democratic presidential campaign.
Steve Forbes, author of “How Capitalism Will Save Us: Why Free People and Free Markets are the Best Answer in Today's Economy,” was a Republican presidential hopeful in the same year. Since then, both men have discussed the flat-tax concept and how it could work in the country and in California. Forbes said, "If done right, it would profoundly and positively change the economy in California. A low single-digit rate would unleash creativity,” and boost the beleaguered state economy.
But why should all Californians vote for such a plan?
1. As FDR said, “Taxes…are dues that we pay for the privileges of membership in an organized society.” It’s time for a truly “fair tax” that lets all pay the same “dues” rate! With a uniform sales tax, when you buy more, you pay more. With a flat tax, the more you make, the more you pay, but all pay the same percentage!
2. A flat tax replaces itemized deductions with one standard deduction (based on dependents) that is large enough to allow the poorest to pay no taxes and the rest to pay the same percentage on all earned income above that deduction. Although the popular deductions for mortgages or contributions would end, the lower tax rate would leave more for taxpayers to spend and donate.
3. Max Baucus said, “Tax complexity itself is a kind of tax.” With the hours and dollars invested in figuring out taxes and finding tax-evasive strategies, imagine the joy of filling out your state taxes on a postcard. Simplicity is in! Let’s make taxes simple and lead the way for a national flat-tax.