Q&A with Dr. Lynn Reaser


Written by: Dr. Lynn Reaser

Q: Is a federal flat tax a good alternative to the current progressive income tax system?

A:  No.  Most Americans are not willing to accept a system where higher and lower income earners would pay the same rate.  They do support a major simplification of the current 3.4 million-word tax code.  Broadening the tax base by eliminating the labyrinth of deductions and exemptions could both reduce all tax rates and raise revenues.  The corporate tax rate should be reduced from the present 35%, which is the highest in the world.  The double taxation of capital gains and dividends (currently taxed as profits at the company level and as income when distributed to shareholders) should also be ended.

Advertisements

3 responses to “Q&A with Dr. Lynn Reaser

  1. Shouldn’t dividends be treated similarly to interest payments at the corporate level, the balance the treatment of debt and equity financing? Then both sources of income (interest and dividends) would be taxed as regular income at the personal level, which otherwise is a unbalanced in favor of dividend earners.

  2. Inc. Magazine had a great article several months ago about entrepreneurs in Norway. They have a lower corporate tax rate, but a higher personal tax rate. The article also notes that the corporate tax rate has fallen from 48% in the U.S. in 1978 to 35%. Shoot, now I sound like I’m supporting socialism. I really should have paid more attention in my PLNU MBA classes…

    http://www.inc.com/magazine/20110201/in-norway-start-ups-say-ja-to-socialism.html

  3. I don’t know if my comment didn’t go through or what, but I posted a link to an article by Inc. Magazine that talks about Norwegian entrepreneurs. The corporate tax rate is lower in Norway, but the personal tax rate is higher. Also, the article mentions that the tax rate is the lowest it’s been since 1978 (48%). http://www.inc.com/magazine/20110201/in-norway-start-ups-say-ja-to-socialism.html

    Reuters also published an article just today that says 30 large corporations in a study paid no corporate taxes at all and the average tax rate is 18.5% for companies.
    http://www.reuters.com/article/2011/11/03/us-usa-tax-corporate-idUSTRE7A261C20111103?feedType=RSS&feedName=businessNews&utm_source=dlvr.it&utm_medium=twitter&dlvrit=56943

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s