Apr 30 2009
Today, Senator Richard Shelby (R-Ala.) introduced legislation to establish a flat tax on all income. Since his first election to the Senate in 1986, Senator Shelby has been an advocate of the flat tax and has introduced similar legislation during each congress.
“Our tax code and its accompanying regulations total tens of thousands of pages, which are complicated and confusing. Americans want a simple, common-sense solution. That is why I have introduced the SMART Act - the Simplified, Manageable And Responsible Tax Act.”
“Given today’s economic difficulties, this bill is needed now more than ever. It is time to end the unnecessary headaches and inefficiencies of our current tax code. The SMART Act would do so in a manner that promotes job creation and prosperity in our country.”
The SMART Act establishes a flat income tax of 17 percent on all income. The only exemptions would be personal exemptions of:
• $13,090 for a single person;
• $16,710 for a head of household;
• $26,180 for a married couple filing jointly;
• and $5,640 for each dependent
These allowances would also be indexed to the consumer price index in order to prevent inflation from raising our tax burden. To prevent the double-taxation of income, earnings from savings would not be included as taxable income. This would result in an immediate tax cut for virtually all taxpayers.
If the SMART Act was in place today, taxpayers would file a return the size of a postcard. There would be no more long hours spent poring over convoluted IRS forms - no more fees paid for professional tax assistance. The complexities and inequities of the current tax system would be replaced by a system that treats every taxpayer equally and represents a massive reduction in the tax burden carried by hardworking Americans.
Under the SMART Act, businesses would pay the same 17 percent rate on the difference (if positive) between revenue and expenses. This would allow businesses to redirect resources away from tax compliance and toward expanding their businesses and creating jobs.
The SMART Act would close tax loopholes for individuals and businesses and instead create broad lower tax rates that would improve American competitiveness throughout the world. This would create and retain jobs right here in the United States instead of driving our jobs overseas.