The Republicans control both houses of Congress and have a President eager to sign tax reform legislation.
To date, the Republican’s, propose more of making the tax code more complex without making any meaning transformational reforms.
The hocus pocus of cutting marginal rates but eliminating deductions to pay for them achieves the political goal of revenue neutrality.
What that means is that Congress will go through its usual gyrations pretending to reform the tax system instead of maintaining the status quo.
One way to think about it is to see the income tax system as a large Rube Goldberg machine fed taxpayers in one end and out spouts money as its product at the other. The product then is distributed to the retail trade of special interest voting groups of the left and right.
Transformation of the tax system requires a different government revenue manufacturing process.
Reconfiguring a complex, convoluted, wasteful system can only be done if that system is redesigned by applying fixed standards which adhere to clear process principles.
As it stands now, the dominate tax reform principles governing the Republicans seem to comprise enacting legislation which appeases their special interest voting constituencies and their campaign contributors.
The problem for the Republicans in Congress is that the taxpayers hate the existing tax system and being terrorized by it. As seen in any number of recent election cycles, and the few 2017 special elections, the taxpayers are inclined to vote for politicians who they perceive as responsive to their plight.
The inability of the Republicans to deliver on their campaign rhetoric of reforming the tax system is proof of their chronic deficiency of political will.
The Republicans have as their primary goal maximizing the money they can squeeze from taxpayers without getting voted out of office.
What they lack is the ability to deal with the three most prominent problems of the existing tax system.
First, the income tax system is not efficiently administrable by the government.
Second, the incomes tax system is not easily compliable by the taxpayers.
Third, the income tax system facilitates the cover-up of an enormous amount of political corruption.
Absent from all Republican tax reform plans are any proposals that will in the slightest way affect these three fundamental tax system failures.
It is not even debatable that the transformation of the income tax system touted by the Republicans will only make things worse for each taxpayer and the IRS.
What tax system might ameliorate these problems?
Think of things this way. The economy is roughly $20 trillion. The amount Congress intends to spend is $4 trillion. That indicates that a 20% national sales tax would work.
There is no perfect tax system. The best system is likely the one that is least bad.
But the income tax system is a failure beyond redemption. I mean, the income tax system has been in place for 104 years, and the result is reasonably described as an ongoing catastrophe.
The Republicans have the political power to transform the existing tax system.
Unfortunately, the Republicans have a chronic deficiency of political will to make the necessary changes.
Denis Kleinfeld is known as a strategic tax and wealth protection lawyer, widely published author and creative teacher.