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A Federalist approach to tax reform

by Guest Post
September 22, 2017
in Opinions

See all the latest videos and articles patriots need to watch and read at Discern.tv.

“Tax Reform.”
What do I mean when I use that term?  Politicians and elites of all stripes and colors tend to muck up the definition with nebulous platitudes that poll well.  The American people then end up believing the way the politicians and media have conveniently twisted and contorted the meaning of tax reform.

Real tax reform, fundamental overhaul of the entire system, is one third economics, and two thirds political.

On taxes, the Left doesn’t really make tax reform a priority, only to talk about their “middle class tax relief,” but only if tax relief is important enough to sway elections.  Why would they prioritize reform, they already have the progressive, direct tax system that they want, thanks to the racist centralizer Woodrow Wilson?
On the Right, the Republican base hates the current tax code, so tax reform is red meat to make campaign promises.  However, GOP politicians and their consultant class figured out they only need to pay lip service to tax reform, but then settle on mere tax cuts for jobs and growth.
Don’t get me wrong, supply-side tax cuts and deregulation (if we can get it) do provide growth in that moment in economic history when it’s implemented.  Nevertheless, the overall trajectory of taxation is still in the direction of the government stealing more of our property.  What has the supply-side, temporary growth really achieved?
The American people and the media have essentially defined tax reform as simply tweaks and cuts to the tax code to provide either relief or growth, depending on which side of the political spectrum you’re on.  It’s the government’s money to begin with, and the people are just cogs in the economic machine to redistribute wealth.

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In the news…

White House plan for tax cuts moves forward – The Washington Post

https://www.washingtonpost.com/business/economy/white-house-plan-for-tax-cuts-moves-forward/2017/09/21/d1482576-9eea-11e7-9c8d-cf053ff30921_story.html?utm_term=.e5eb6dd9a420&wpisrc=nl_rainbow&wpmm=1The White House plan for a massive package of tax cuts is gaining new momentum as Republicans attempt to set aside months of intraparty squabbling and unify behind a key part of President Trump’s agenda. Two developments are accelerating the effort: Key Senate Republicans reached a tentative deal this week to allow for as much as $1.5 trillion in tax reductions over 10 years; and there is a growing willingness within the GOP to embrace controversial, optimistic estimates of how much economic growth their tax plan would create. Those upbeat estimates, often rejected by nonpartisan economists, would supplant the traditional forecasts offered by official scorekeepers at the Congressional Budget Office and Joint Committee on Taxation, helping lawmakers argue that the plan would not increase the national debt.


The Washington Post is reporting the Trump White House has a plan to push “massive tax cuts,” and that it’s apparently “gaining new momentum,” whatever that means.  But nobody, I mean none, talk about reforming the tax system to a new tax code.  All the talk is centered around who’s relief or cuts is better for the economic growth and jobs for the country broadly, and for the middle class specifically.  Oh, and apparently every economic plan has to take 10 years to go into effect, then they get to squabble over whether to make it permanent or let it expire.
I’m always equally intrigued and dismayed by news of White House plans and Republican attempts at tax reform.  Intrigued because we’re in desperate need for a tax overhaul, but I’m dismayed because I know what they usually mean by “tax reform.”
Real tax reform, fundamental overhaul of the entire system, is one third economics, and two thirds political.  Yes, there is an economic component to taxes; we are dealing with finances and money after all.  But the primary function of taxation concerns the political nature of funding government.  Therefore, the primary questions tax reform must address: what is the size and scope of the government that needs funding, and what type of government are we needing to fund?
In our Constitutional Republic, we used to have a federal government of independent states.  Is progressive direct taxation appropriate for our form of government?  Or do we need a federalist tax system that “eliminates all direct federal taxes and replaces them with a uniform, flat federal tax on the gross government revenue of each state.”
It’s called the “Neutral Tax.”


LEARN | Neutral Tax

http://www.neutraltax.com/learn/What is The Neutral Tax? The Neutral Tax is a flat, federal tax on gross state government revenue

Read The Neutral Tax White Paper Sound interesting? The Neutral Tax White Paper Read more…


It’s a reform that recognizes that we are constitutionally structured as a federal union of United States, not a national government with glorified counties and municipalities.  It takes into account that each state is different and “eliminates the federal government’s micromanagement of tax policy.”  The Neutral Tax restores the sovereignty of each state in domestic and economic affairs.
We can debate the economics of what the rate of the Neutral Tax ought to be in due time, but for now, what is the politically and constitutionally more appropriate tax system for our political system of government?

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