Tax deductions are regressive — it makes sense to remove them in exchange for rate cuts.
National Review Online
April 20, 2012
Paul Krugman has called Representative Paul Ryan’s (R., Wis.) budget “the most fraudulent in American history.” He and fellow critics take issue with the fact that Ryan promotes balancing tax cuts with the elimination of tax credits and deductions, but doesn’t specify which he would remove. Ryan and his staff contend that since a budget is an appropriations request — not a revenue plan — he can only suggest reforms to the Ways and Means Committee, which deals with tax policy.
Unfortunately, this back-and-forth has overshadowed the fact that getting rid of tax preferences is sound policy. Indeed, both the Bowles-Simpson Commission and the Domenici-Rivlin Task Force supported eliminating tax preferences in order to “broaden the base” of taxable income.
Read the full blog post here
Economic Policy Project