[Congressional Record (Bound Edition), Volume 154 (2008), Part 5]
[Senate]
[Page 6131]
[From the U.S. Government Publishing Office, www.gpo.gov]




                               TAX REFORM

  Mr. VOINOVICH. Madam President, the time for a honest, national 
discussion of fundamental tax reform is long overdue. Each year, April 
15 looms on the calendar as a day of reckoning for American taxpayers 
facing a laborious and needlessly stressful process. Since enacting the 
Tax Reform Act of 1986--legislation intended to simplify the filing 
process for taxpayers--more than 15,000 provisions have been added to 
the Internal Revenue Code.
  The irony of our complex Tax Code is that in order to take advantage 
of all the benefits and deductions for which they qualify, Americans 
have to spend a significant amount of money to pay someone or something 
to do their taxes for them--thus decreasing the value of their return. 
According to the President's Advisory Panel on Federal Tax Reform, only 
13 percent of taxpayers are able to file without the help of either a 
tax preparer or computer software.
  The Tax Foundation estimates that in 2005, individuals, businesses, 
and nonprofits spent an estimated 6 billion hours complying with the 
Federal income tax code, with an estimated compliance cost of more than 
$265 billion. This amounts to imposing a 22-cent tax compliance 
surcharge for every dollar the income tax system collects.
  Tinkering with the current Tax Code won't get the job done. Tinkering 
is what got us into this mess in the first place. We must enact 
fundamental tax reform--a complete overhaul of the system that would 
make the Tax Code simple, fair, transparent, and conducive to economic 
growth and private savings.
  Tax reform is not just a matter of simply saving taxpayers time and 
effort. This is about saving taxpayers real money. Comprehensive tax 
reform could save Americans the $265 billion in compliance costs. Now, 
that would be a real tax reduction that wouldn't cost the Treasury one 
dime.
  A new tax system is also vitally important to job creation and 
economic growth. In addition to simplification for average families, we 
must address one of the biggest problems with the current code: it 
rewards moving production activity--and the good-paying jobs that 
accompany such activity-- overseas. It taxes domestically produced 
goods heavily and taxes foreign-made goods lightly. We have the second 
highest corporate tax rate in the developed world, but we are near the 
bottom in corporate tax collections as a share of the economy. Such a 
system sounds absolutely perverse, but that is what we have in the 
United States.
  Some of my colleagues will suggest that we can just increase marginal 
rates to raise the revenue we need. But in a competitive global 
economy, I can't understand why we would choose such a self-defeating 
approach. Higher marginal rates on an already-broken tax system would 
only discourage economic ingenuity and reduce U.S. competitiveness. 
Recent economic research concludes that in a global economy workers 
bear the brunt of higher corporate tax rates, through lower wages and 
fewer jobs.
  The bottom line is Congress needs to take tax reform seriously. I am 
actively evaluating proposals that would simplify the Tax Code, save 
taxpayers billions of dollars, expand the economy, and most 
importantly, protect American jobs. I have already discussed the need 
for such legislation with many of my colleagues, and I know there is 
bipartisan support in the Chamber for comprehensive and timely action.
  We can start the process by enacting legislation to create a 
bipartisan commission to propose tax and entitlement reform legislation 
that Congress must vote on under fast-track procedures, such as my SAFE 
Commission Act or the Bipartisan Task Force for Responsible Fiscal 
Action that has been proposed by Senate Budget Committee chairman Kent 
Conrad and ranking Republican Judd Gregg. With or without such a 
commission, Congress and the next President must move forward on 
comprehensive tax reform that simplifies the code and creates jobs in 
the United States.

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