February 27, 2007
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WASHINGTON, D.C. - Lawmakers must take steps toward fundamentally reforming the federal tax system in order to resolve long-term issues such as entitlement spending, the alternative minimum tax, and simplifying the tax code, according to a former top tax official at the U.S. Treasury.
"We have some major issues facing us as a country," said Mark Weinberger, currently Vice Chairman for Tax Services at Ernst & Young.
Weinberger, who is a former Assistant Secretary for Tax Policy at the U.S. Treasury, discussed those issues in the Tax Foundation's most recent Tax Policy Podcast (listen).
"Simplification is always something that people espouse. But when you have a tax system that is being used to run social policies through, and economic policies through, and fairness and progressivity policies through, it's almost by definition very hard to have a simple tax [structure]," he said.
Reforming the alternative minimum tax will be next to impossible without fundamental tax reform, Weinberger explains.
"I know that the Democrats have made it a stated objective in the campaigns this year to repeal the AMT, but the shackles they placed on themselves with the PAYGO rules...are going to make it very difficult to come up with over $1 trillion to permanently repeal the AMT," he said. "If you really want to tackle with the underlying issue - which should be tackled - you have to, I think, wrap it up in the larger tax reform."
Weinberger also lamented recent trends that are making U.S. businesses uncompetitive.
"When you look at the overall regulatory burden on U.S. companies, add to it the high cost of deal making in this country, plus the litigation environment, enter on top of that a high corporate tax rate, we really are trying to ask our companies to compete with one arm tied behind their back," he said.
The interview is Number 22 in the Tax Foundation's Tax Policy Podcast series. It's available online here.
The Tax Policy Podcast features an interview that sheds light on the nation's tax system. Best known for its annual calculation of Tax Freedom Day®, the Tax Foundation is a nonpartisan, nonprofit organization that has monitored fiscal policy at the federal, state and local levels since 1937.
For media inquires please email Brian Phillips or call 202.464.5102