For Immediate Release
Office of the Press Secretary
September 2, 2004
President Bush Provides Leadership on Tax Reform
America has a growing, dynamic, and changing economy - but our tax code
has not kept up with the times. The current tax code is a maze of
special interest loopholes that causes America's taxpayers to spend
more than six billion hours every year on paperwork and other
headaches. President Bush believes that America's taxpayers deserve,
and our future economic prosperity demands, a simpler, fairer,
pro-growth system - and he has pledged to lead a bipartisan effort to
reform and simplify the tax code.
The time that people spend complying with an overly complex tax
code is a burden and a waste of resources that has been growing over
time.
The Internal Revenue Code contains more than a million words.
The number of pages in the Internal Revenue Code and regulations
has more than doubled over the past twenty years. Today's "short" income tax form takes more than 11 hours to prepare - about the same as the "long form" did a decade ago.
It takes 12 pages of instructions to calculate the Earned Income
Tax credit - a basic element of income-support for the working poor.
By 2010, more than one in five taxpayers will be forced to
calculate their income taxes twice -once for the regular income tax and
once for the Alternative Minimum Tax - and then pay the greater
amount.
President Bush's Action to Promote Tax Reform
President Bush announced that he is making tax reform a key
priority.
The President will begin this effort by creating, by Executive
Order, a bipartisan panel to advise the Treasury Secretary on options
to fundamentally reform the tax code to make it simpler, fairer, and
pro-growth.
The President's goals are to make the tax code simpler and to
increase long-run economic growth and job creation. Taxes should be
applied fairly, and reform should recognize the importance of
homeownership and charity in our American society.
Background: The Bipartisan Advisory Panel on Tax Reform
The President will create a Bipartisan Advisory Panel on Tax
Reform:
The President will appoint experts, economists, and economically
knowledgeable and experienced people of both parties.
The panel will be charged with holding public hearings and seeking
input from Members of Congress.
The Panel will consult and debate and will provide its advice and a
report to the Secretary of the Treasury as early as possible in 2005.
This advice will inform the Secretary in his efforts to make
recommendations to the President.
The Panel will be asked to answer certain questions.
Principle: The tax code should be simpler.
How can tax reform reduce the administrative burden on taxpayers?
Should tax reform modify the current system or replace the system
with a new one?
How should the transition from the old to the new system be
handled?
Principle: The tax code should be fairer.
What tax loopholes need to be closed to eliminate tax evasion and
ensure that everyone pays his or her fair share?
How can we ensure that the benefits of tax reform are spread widely
among Americans?
What is the best way to make the tax system progressive, an
attribute that is fundamental to fairness in taxation?
To what extent should the tax system be used to achieve goals other
than raising revenue?
How should the tax system deal with different family structures?
Principle: The tax code should promote economic growth and job
creation.
How can the tax system increase economic growth and job creation?
How can the tax system better encourage work effort, saving, and
investment?
How can we make American workers and firms more competitive?
The Panel will be asked to present revenue-neutral reform options
to the Secretary of the Treasury, at least one of which should be a
reform of the current individual income tax system.