Whatever Happened To Tax Reform?
All through his campaign for re-election, President Bush repeatedly promised that if given a second term, he'd lead the fight to "reform" the tax code.
"Another draw on our economy is the current tax code," he told the Republican National Convention in accepting it's re-nomination on September 2, 2004.
He called the tax code "a complicated mess, filled with special interest loopholes, saddling our people with more than six billion hours of paperwork and headache every year."
"He said the American people deserve – and the U.S. economy demands – "a simpler, fairer, pro-growth system."
Well, if you just finished filing your federal income tax return, you know that simple and fair are about the last words you might use to describe the tax code – especially if you were hit by the Alternative Minimum Tax and you're no millionaire.
Initially, President Bush moved to deliver on his promise. On January 7, 2005, two weeks before he took the oath of office for a second term, he established an Advisory Panel on Federal Tax Reform. He named former republican Senator Connie Mack and former democratic Senator John Breaux to head the nine-member blue-ribbon committee.
He charged the group to explore ways to "simplify the tax code."
"I believe this is an essential task for our country," he said.
He gave the panel marching orders to come up with recommendations to overhaul the tax code so that taxpayers would be treated more fairly.
The committee was originally given until July 31, 2005 to put foward its ideas. But the Administration wasn't ready to receive the recommendations that early and essentially told the panel to take more time.
It heard from nearly a hundred witnesses and received thousands of written comments – that in the panel's words "described the unacceptable state of our current tax system."
Just about 10 months after it was established, the committee reported its findings. It offered two options: "the Simplified Tax Plan" and the "Growth and Investment Tax Plan." Both called for sweeping changes in the federal tax code. (You can find more on the panel's recommendations right here.)
The report was delivered to the Secretary of the Treasury on November 1, 2005 – and it's been gathering dust ever since.
The Secretary was supposed to forward it to the President within 60 days, but never has. In fact, the Secretary who received it, John Snow, is now gone. And his successor, Henry Paulson, has yet to act on it.
Deputy White House Press Secretary Tony Fratto tells CBS News that the President remains committed to tax code reform and "hasn't given up on it."
But with all that's on his plate, and with democrats now in charge of Congress, it doesn't appear that President Bush can do much about tax code reform during his remaining time in office.
Worth noting: the last tax reform bill was enacted in 1986. The reform panel says that since that time, there have been nearly 15,000 changes in the tax code. The panel writes that "no matter how well-intentioned, (such changes) ultimately undermined the integrity of the code in real and significant ways."
