Dear [Representative or Senator],

In following the debate on tax cuts, it seems that one side is working for a smaller "number," and the focus on the (fraudulently calculated) number is taking away from the big picture.

The best way to use tax law to improve the economy is simplification and fairness. That means tax all income the same! (The definition of "taxable income" will still be a subject for debate.) Let's use the debate about taxes to focus on that idea!

I suggest that we fight hard to eliminate the double taxation of corporate income, but offset that "revenue loss" for those worried about the "number" by taxing all corporate income the same:

  1. Eliminate tax brackets for corporate income tax; i.e., all income is taxed at one rate -- the current top bracket rate of 35%. (Yes, this proposal does get rid of the silly 39% bracket and 38% bracket embedded in the rate schedule to eliminate the effect of the lower brackets in some cases.)
  2. Eliminate the Chapter S filing status invented to avoid double taxation in certain circumstances (since double taxation will no longer exist).
  3. Eliminate personal service corporations since the provision for standard corporations would be very similar under this proposal.
  4. Eliminate rules allowing (or requiring) consolidation of multiple companies on one return. These rules were invented to reduce abuse of lower tax brackets, which would no longer exist under this proposal. This would increase revenue by disallowing the offset of one corporation's income with a loss from a money-losing corporation.
These proposals also have the advantage of greatly simplifying the corporate portion of the tax code. I would also suggest the following changes to the definition of "taxable income" (in order to simplify taxation, and to further offset the loss of revenue from eliminating the taxation of dividends):
  1. Eliminate tax loss carry-back, but make tax loss carry-forward go on until it is offset by profit.
  2. Eliminate deductions for meals and entertainment (the ones that are currently only partially deductible).
  3. Eliminate the deductions for state and local taxes (for all entities, not just corporations). I see no reason why the federal government should treat income differently based upon the residence of the person or entity earning the income.
These suggestions are taken from the ComingTogether Plan (see www.ComingTogether.info), or are consistent with that plan. I would appreciate it if you would look at that plan to see the larger context from which these ideas are taken.

Thank you for your service representing our [District, State].

God bless you,