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Bush moves to reform tax code
by Bill Straub
Scripps Howard News Service


January 08, 2005

Washington - With Social Security reform already on his second-term agenda, President Bush on Friday assumed the equally thorny task of transforming the notoriously complicated tax code.

Two former U.S. senators, Republican Connie Mack of Florida and Democrat John Breaux of Louisiana, have agreed to serve as chairmen of a Bush-appointed nine-member panel responsible for exploring ways to simplify a tax system whose most recent overhaul came in 1986.

The announcement, issued from the Oval Office, sets into motion an effort to follow through on a pledge the president offered during his re-election campaign. The present system, Bush asserted throughout the contest with Democratic rival John Kerry, is a hindrance to America's economic aspirations.

"I believe this is an essential task for our country," Bush said in making the announcement. "It's a task that will treat our taxpayers more fairly. A simple code will make it easier on the taxpayers. But it's an important task in order to make sure the economic growth we are seeing in the United States continues forward."

Complying with the tax code, which runs hundreds of pages and is considered too complex for one person to master, costs more than $100 billion a year, according to some estimates. Bush said taxpayers spend "billions of hours filling out the forms."

While Democrats and Republicans alike have acknowledged for some time that the code requires retuning, lawmakers have not come close to an agreement over how to address the problem.

House Democratic Whip Steny Hoyer of Maryland agreed that tax reform is "long overdue" and criticized the administration, saying that the three tax cuts enacted during the president's first term "only made the tax code more complicated."

"Public confidence in the integrity of our tax system is critical, and we must act without delay," Hoyer said. "Democrats have every intention of fighting for our core principles on this issue - fairness, simplicity and responsibility. Tax reform must increase taxpayer fairness. The middle class must not be forced to bear a larger tax burden. The code must be made simple."

Treasury Secretary John Snow told reporters after the announcement that "everything's on the table," meaning the President's Panel on Federal Tax Reform will have the authority to propose elimination of popular provisions like deductions for home mortgages and charitable contributions.

It could also consider alternatives to the federal income tax, like the national sales tax championed by former House Republican leader Dick Armey of Texas.

The panel is scheduled to deliver its report to the Treasury Department by July 31. Bush said he is "firm in my desire to get something done" to see that the system "encourages economic vitality and growth."


E-mail Bill Straub at StraubB(at)
Distributed by Scripps Howard News Service

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