OUT IT

Sorting through a shift toward a consumption tax (David R. Francis, 6/30/03, CS Monitor)

Conservatives are rejoicing. They see the United States already on a path of fundamental tax changes that will accelerate economic growth.

"Stealth tax reform," it has been called. That's because relatively few voters are aware of the significance of the changes in the system proposed by President Bush and incorporated in the three tax-cutting measures passed by a Republican-led Congress since he took office.

"George W. Bush is the first president to actively understand and embrace the fundamental core principles of tax reform," says Ernest Christian, a founder of the Center for Strategic Tax Reform in Washington. [...]

The next likely "baby step" is the revival of the Lifetime Savings Account proposed by Bush last January, and later dropped for fear it would distract from the White House goal of selling its main tax package. The radical measure would allow taxpayers to contribute up to $7,500 a year of after-tax income into an investment account where it could grow untaxed and be withdrawn tax-free later for retirement, education, or other purposes.

"That is coming back," says Chris Edwards, a fiscal expert at the Cato Institute in Washington. He sees it as having political appeal in an election year. And its revenue loss is small in the 10-year window used by Congress in looking at tax bills.

The measure would also move toward a consumption tax by easing the tax burden on money not spent, that is, savings.

This seems like a worthwhile national goal, but one that should be talked about in this coming election. Posted by Orrin Judd at June 30, 2003 12:26 PM