Watching the presidential campaign, everyone seems to be coming out with their own plan for tax reform. Either that, or they're coming out guns blazing to criticize someone else's tax plan - Democrats and Republicans alike. But here's the question I have: what is the exact problem they're trying to solve? Nobody really says, except for vague generalities so they don't get pigeonholed into actually taking a stand on something. But this is the critical question, isn't it? Because the solution will be different depending on what they're trying to accomplish.
Let's take one common complaint, that everyone should pay their "fair share" of taxes. There are complaints that the rich don't pay enough, corporations don't pay enough, or whatever. So what does "fair share" really mean? If it means everyone pays exactly the same amount, which is what "fair" used to mean back in kindergarten, then we'd just have a flat fee that everyone pays every year, say $5000 for each of us. But nobody is really advocating for that sort of plan. So maybe "fair" means we all pay in proportion to our income level? In that case, we should all pay the same percentage, which is just another way of saying a flat tax. This is what Rick Perry is proposing, but most people that are in favor of everyone paying their "fair share" don't like Rick Perry's plan. Why is that? Because they want to rich to be penalized, to pay
more than their proportional amount. That's called a progressive tax rate, and it's what we already have today, if you ignore exemptions and write-offs. But they're not happy with that, either, because they want it to be even more "progressive". Some are even under the misguided delusion that making the rich pay more will somehow put more money in the pockets of everyone else. So maybe they just want the exemptions eliminated? Nope, Democrats and Republicans both put up a strong resistance to this idea.
Another complaint is that there is a gap between what the rich and the poor pay. Do they mean gap in percentage or gap in actual dollars? Of course, they never clarify. But either way, the problem with this argument is that the poor really don't pay taxes in any significant amount, so correcting the gap would necessitate raising taxes on the poor, unless we all just happen to decide that nobody should pay taxes. Usually what people mean by this argument, though, is that there's a gap in the percentage the rich pay vs. the percentage that
some people in the middle class pay. The rich, though in a higher tax bracket, usually lower their tax burden through exemptions and write-offs. Many of these avenues are also available to the middle class, it's just that most of them aren't educated about them or aren't willing to go through the extra effort to take advantage of them. The way to reduce this gap is to create a flat tax with no exemptions allowed. But again, the people complaining about this don't like that solution. Mainly because it actually makes everything even, and they feel the rich should be somehow punished.
A third complaint is that the government simply needs more revenue. This is an entirely different problem and really can't be solved by simply raising the taxes on the rich. Even if we taxed the top 1% of the population (the rich) for 100% of their income, it really wouldn't make a significant difference in federal revenues. Even if we confiscated 100% of the accumulated
wealth of the rich, it would be a minimal impact to the federal revenue. Plus, that's the sort of thing that can happen only once, because once you do it they have no more wealth to confiscate. The real way to solve this problem is to have a national sales tax. Why would this work? Because it would immediately force people that don't normally pay taxes to start paying - illegal immigrants, drug dealers and other criminals, foreign dignitaries, and even tourists. Such a vast increase in the tax base would have a tremendous impact on government revenue. Not only that, but it would reduce government spending by virtually eliminating the IRS and all enforcement that goes along with it. These reductions would spread to corporate America, both small and large businesses, and even to our court systems. If done correctly, it could also leave almost every American with more money in their pockets.
A fourth potential problem is the sheer complexity of the current tax system. Some people just want something simpler, fairness be damned. Most of the proposed tax plans are considerably simpler than our current tax code. The problem is, the proponents of those plans feel the need to defend against accusations of unfairness (because they're not clear what problem they're trying to actually solve) and thus start muddying the waters by introducing waivers for the poor, waivers for the elderly, and who knows what else. If they continue down that road long enough, they will eventually succeed in recreating our current tax plan. Great job, guys.

So which problem are we trying to solve exactly? Do we want everyone to pay the same, fair amount? Then let's first agree on the definition of "fair" and then most likely go with something like a flat tax, similar to what
Rick Perry is proposing. But let's also understand that we'd achieve fairness by raising taxes on the poor and without significantly increasing federal revenue.
Do we want to increase government revenue, while also leaving more money in the pockets of most Americans? Then let's go with something like the
Fair Tax, which is strongly advocated by people like Neal Boortz. But let's do so with the understanding that the transition to such a system might be difficult, especially for people near retirement age, and that not everyone will be paying the same amount of tax, though it could still be considered fair in that people would pay proportional to what they spend.

Or maybe we want a little of both approaches? In that case, something closer to the
9-9-9 Plan proposed by Herman Cain might be a better bet. This would minimize the risks and potential negatives of both a flat tax and a national sales tax. Of course, it would also reduce the benefits of both, so we'd have to ask ourselves if it's really worth it? Maybe, maybe not....what's our goal again??
Or perhaps the goal is to simply punish the rich for the act of being rich? Then we should just raise taxes on the rich like some Democrats want and call it a day, but with the clear understanding that we wouldn't have accomplished anything substantial except making some people feel good. That, and ensuring those Democrats get re-elected, of course.
The point is that most of these people aren't trying to solve any problem at all, except the problem of how they get elected or re-elected. The few that are trying to solve a problem aren't making that clear and standing out from the crowd, and everyone else is being foolishly led to argue over meaningless ideas that will never solve the problems they're truly concerned about.