As long as there is a need for government there will be a need for taxes. If we start with the premise that government is necessary, and that it needs to collect taxes to pay for constitutionally-mandated expenses, such as national defense, a court system, and coining a currency, then the next logical question is, “What is the best way to collect taxes?” In 1999, about two-thirds of Americans in an Associated Press poll thought that the federal tax code was too complicated, with 56% saying they paid someone to do their taxes. In 2011, economist Dr. Arthur Laffer estimated that the annual cost of complying with the federal tax code was about $431 billion, which at the time was about 30 cents for every dollar of income tax collected. In 2013, the CCH Standard Federal Tax Reporter estimated that the U.S. federal tax code was about 74,000 pages. In 2014, retiring U.S. Rep. Dave Camp estimated that Americans spent over 6 billion hours filling out tax forms. The Affordable Care Act and other federal mandates keep pushing these estimates higher and higher. Imagine how much better our professional and personal lives would be if this time and money were spent on productive and enjoyable pursuits, rather than on the tax bureaucracy.
For some, the solution to the tax complexity challenge is some form of a flat rate income tax. For others, a national retail sales tax is the answer. But what if they are both right? What if the best way to implement a national retail sales tax is first to transition the existing income tax to a flat rate; and then, after the 16th Amendment that authorized the income tax is repealed, a national retail sales tax is implemented? That is the vision of The Simple Tax.