Today, Senate Finance Chairman Baucus (D-MT) and Ranking Member Hatch (R-UT) sent a letter to their colleagues proposing “blank slate” tax reform. The blank slate approach to tax reform would start by eliminating all existing tax breaks, and force provisions to be individually justified to be added back into the code. We think this is the right way to go, and TCS has long advocated this zero-based approach.
In an April letter on tax reform to the Ways & Means Committee, TCS president Ryan Alexander wrote, “[we] argue for a zero-based approach that would assume all the expenditures are eliminated, the top rate reduced and provisions would have to have significant justification for inclusion.” Earlier in the year, in her testimony to the House Committee on Oversight and Government Reform, Alexander stated about tax reform: “We would go so far that just like zero-based budgeting, we should have a zero-based approach to tax expenditures.”
Today’s letter from Baucus and Hatch puts the Finance Committee in alignment with House Ways & Means Committee Chairman Camp (R-MI), who said back in early May, “We're not going to take the current code and see what comes out. We're going to take a blank piece of paper and see what goes back in."
Taxpayers for Common Sense is encouraged by this development and we’re looking forward to a vigorous debate regarding the effectiveness of the litany of tax breaks and tax expenditures that reduce revenue by more than $1 trillion every year. To be sure, the special interests will have their long knives out, but by making each provision be justified in the light of day, we may be able to achieve comprehensive tax reform.