2.2: Tax Reform
Collaboratively undertake an intergovernmental tax reform initiative. Other Information:
An intergovernmental tax reform initiative must be undertaken in a collaborative manner. There is a need for a national tax
reform initiative that should include federal, state and local governments. While recent federal budget commissions have called
for federal tax reform to simplify the tax code and raise revenue, we worry that such an effort could lead to further erosion
of fiscal capacity of state and local partners in our federal system. A national intergovernmental tax reform initiative would
be far more effective in giving serious consideration to important new revenue systems such as a national consumption tax.
As other OECD nations have shown, a national consumption tax along the lines of a value added tax could provide significant
advantages for the national economy both in terms of additional revenues and savings incentives. However, given the states’
substantial investment in sales taxation, only an intergovernmental tax reform process can gain the support of states that
will be critical to implementing much needed reforms.
Indicator(s):
|
