Marriage tax relief, which would allow couples to subtract 10 percent of the earnings of the lower-paid spouse, would add complexity. Non-itemized charitable deductions would complicate many tax returns and their audits. New rules on the carryover basis of estates would add confusion and controversy. Unfortunately, the Bush tax plan is oblivious to compliance costs and the urgent need for long-term tax reform. Even if all its proposals were to become law, it would not improve the burdensome system.
American business is forced to labor under difficult conditions in an anti-business tax system.
And after all business taxes have been paid, the estate tax seizes up to 55 percent of all assets when the owner passes away. Owners of corporate stock pay taxes twice, once as corporate profits and then again as personal income. Finally, businesses must cope with complex pension rules, capital gains rules and expense allocation rules, inventory capitalization rules and economic performance rules, all of which impose huge compliance costs. Unfortunately, the tax-cut plan does not propose to reduce these costs. Every party seeks to reshuffle the benefits and reassign the burdens in a never- ending political struggle.