The Iowa Legislature’s latest attempts to remove federal deductibility give us more proof our tax code and philosophy both in the state and nationally is out of whack. How many times do we have to have these arguments about this tax or that tax until we can finally settle on the most simple, fairest tax structure known to man…a consumption tax?
A consumption tax would end all debate on tax changes from the very day it’s passed. We wouldn’t have to worry about a tax on a tax, a death tax, a luxury tax, or an income tax. We wouldn’t have frustrated individuals paying their accountants 95 cents to save a dollar. We could finally get rid of the illogical and counterproductive tax on production and put it on consumption.
With the economy struggling, there is no better time to pass major tax reform in the form of a consumption tax. I don’t think you could find anyone out there who doesn’t believe we have a production problem in the United States and especially Iowa. I also don’t think anyone would say we don’t have a consumption problem. We’ve made it so easy to spend money and so hard to make money. We have record amounts of debt along with record amounts of taxes and regulations. We must move the tax from production to consumption.
And while the fight is going on in the capitol, what are we hearing from our side of the aisle? Not major reform. We are just getting the against, against, against approach. Sure, Republicans in the Iowa House may stall this latest tax increase off, but will our opposition last forever? Will we decrease taxes for everybody anytime soon…or ever? History tells us the answer is no since we’ve incrementally lost almost every battle on taxes since they were instituted.
We have the opportunity to drastically change our tax structure. We can easily get rid of the state income tax. Others have. We can easily cut spending and eliminate departments. Others have. With a simple approach taken by our Republican legislators, Iowa can become a state known for thriving businesses instead of flyover country where our kids graduate college and move out of state.
What’s stopping the change? What are we afraid of? With our current economic situation nationally and in Iowa, bold leadership is required. That means more than just saying, “No.”
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