How to Fix Our Appalling Tax Code -- By Dave Camp, The Wall Street Journal

(Image by Martin Kozlowski)

Every year Americans spend more than six billion hours and $168 billion to file their returns 

There have been so many changes to the tax code over the past decade that it is now 10 times the size of the Bible, but with none of the Good News. That factual statement usually gets a good laugh back home in Michigan. What isn't funny is the effect that constant tinkering with taxes has had on the people who pay them, and on the economy. 

According to Nina Olsen, the National Taxpayer Advocate at the IRS, Americans overall spend over six billion hours and $168 billion every year to file their returns. This is stark testimony to the complexity of the tax code. Meanwhile, owners of small businesses face tax rates as high as 44.6%, while the total (state and federal) U.S. corporate rate, 39.1%, is the highest in the industrialized world. 

The last time the U.S. enacted a comprehensive tax reform was 1986. But many of America's major competitors have been actively reforming their tax laws in recent years. Even our closest neighbors are getting ahead of us. Canada has already reformed its tax laws and Mexico is doing so right now. If Congress doesn't take action, the U.S. risks falling further behind. 

The tax code should make it easier for American companies to bring back profits earned overseas so they can be invested here. It should not hinder small businesses from growing into large businesses. And the individual income tax needs to be simpler, fairer and flatter for everyone. 

On Wednesday, I am releasing what a simpler, fairer tax code actually looks like. The guiding principle is that everyone should play by the same rules—your tax rate should be determined by what's fair, not by who you know in Washington. Here is what it would look like: 

First, the tax code will be made simpler—so every family can do its own taxes confidently, without fearing an audit, or wondering if someone else who can afford an expensive accountant is getting a better deal.

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