Perhaps most shocking, tax revenues have doubled since 1987. Lowering the rates of taxation is the fairest way to reduce this record tax burden. Rate reductions are desirable not only because all taxpayers get to keep more of their money, but also because lower rates will increase incentives to work, save, invest, and take risks. Ideally, lawmakers should scrap the entire tax code and replace it with a simple and fair flat tax. A flat tax would tax all income, but only one time and at one low rate.
History demonstrates that lower tax rates are good for the economy.
Tax rate reductions in the 1920s, 1960s, and 1980s all resulted in faster growth, rising incomes, and more job creation. A fundamental precept of all economic theories is that higher prices will reduce the amount of a product that is purchased. By every possible measure, the tax burden in the United States is excessive and tax rates are too high. Federal tax revenues this year are projected to consume 20.5 percent of U.S. economic output. According to the Tax Foundation, taxes at all levels now consume nearly 38 percent of the average dual-income family's income.