From Roll Call:
What’s the first step to revising America’s low saving rate? Cut out all the current incentives for savings enshrined in the tax code. It’s not as crazy as it sounds. Recently, Senate Finance Committee leaders Max Baucus and Orrin G. Hatch endorsed this radical approach to tax reform by vowing to wipe the code clean and start over with a blank slate.
Since Congress last passed a comprehensive tax reform in 1986, there has been a proliferation of deductions, credits and expenditures that have added complexity but generated meager amounts of net new savings. The senators vowed to justify each and every deduction, credit and expenditure that makes its way back into the tax code. They’re on to something. Rather than costly tax shelters, we need incentives that work. The “blank slate” approach offers an opportunity to go back to the drawing board and get it right.
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