The current tax system runs to seventeen thousand pages of regulations. It is, literally, impossible for anyone to understand it. With even a moderately complex financial situation, there is no way to be assured that you are in compliance with the law. Every year, journalists will create a fictional family of four, with a reasonable spread of investments and assets, and earning something in the comfortable middle of the income spectrum. They will send this hypothetical tax picture to several IRS functionaries, tax accountants, and HR Block type tax preparers. No return will match any of the others. Better to spend your time figuring how many conflicted, compulsive centrists can agonize on the head of a pin.

On general principle, the current scheme should be completely scrapped. Vague and conflicting regulations make enforcement arbitrary and predatory. When you speak of fear of the government, most people don’t think Big Brother, they think the IRS. There is absolutely no need for a tax system this Byzantine, this elephantine, this cruel; especially in a republic with pretensions to liberty and justice. And beyond the costs of shoveling an average of a third of our income onto the IRS fire, there is the cost of preparing the tax returns themselves. Millions of man hours for the general public, billions spent by businesses and individuals to tax accountants and tax preparers that could be spent more profitably elsewhere. Further, there is the uncalculated effect of tax law on how businesses change practices to avoid punitive tax liabilities, like delaying replacement of aging capital equipment (a factor in the industrial decline in the Midwest), avoiding investment, delaying capitalization and a hundred other things to obscure for me to comprehend.

But what to replace it with? Conceivably, we could replace the current nightmare with something simpler that worked in largely the same way – tax brackets, deductions, credits – but easier to cope with. But if we are going to go to the effort to replace it, it ought to be something better.

I feel that the current tax system makes a mockery of our commitment to justice and equality before the law. If it is illegal to discriminate against someone for reasons of creed, color or gender, why is it kosher that a one set of tax laws applies to Mike, completely different set of laws applies to Mr. and Mrs. Two-Cents, and yet a third and even harsher set of laws applies to the Buckethead clan? If Mike were white, and Johnny Hispanic and me black, legions of the unwashed would rise up in protest. Yet, there is not a murmur of discontent when it is shown that these three have different incomes.

We should always be treated the same before the law. If I kill someone, the same law should apply to me as when Johno kills someone. Even if I did because they deserved it and Johno kills merely because they have bad taste in music. Similarly, the same tax laws should apply to everyone, even if one of us makes more money than the other. This is the primary moral argument for a flat tax.

If we assume that the current level of revenue is adequate for government needs (sharp internal wrenching pain) we could structure a new tax system that would generate that much money. One of the reasons that our tax system is so complicated is that all the many special interests, over decades, slowly weaved a web of exemptions, shelters, credits and what-have-you into the tax code. Most of these complications have no positive effect on the economy as a whole, and many are probably very negative. One way to eliminate unfairness is to completely eliminate all the complications. If every person, and every corporation, paid 10% of income to the government everyone would be on the same level. No industry would have special sanctions, or considerations. It would limit the government’s meddling in the economy. (Tax law is a great sub rosa way to meddle, because it is less obvious.)

The thing is, if I pay 10%, and Mike pays 10%, that’s fair – even though I will pay more in absolute terms. If it’s that simple, I can compute my tax return in seconds. Even corporations would have a simpler time of it. In the wake of the fall of the Soviet Union, the Russian Federation had high taxes. But almost no revenue, because the government was largely incapable of collecting it. When they switched to a flat tax, their revenue skyrocketed. One, because the lower tax rate was fair enough that many who had not paid taxes now paid them, and two, because it stimulated the economy. And if I know every corporation and rich person is paying ten percent, I’m much less likely to think that the fat cats are getting away with murder, because there would be no loopholes or tax shelters.

While I said earlier that the government shouldn’t use the tax system to meddle with the economy, or use it for social engineering, that is only generally true. While staying within the flat tax format – so that the same laws apply to everyone, we can fudge it a bit to have beneficent effects. For example, a certain standard set of deductions would apply to everyone’s income. A personal deduction, child deductions, mortgage interest, marriage deduction are all good candidates. These deductions would be set amounts, so the effect on someone with a low income would be proportionally much larger than for someone with a large income. You could finagle these deductions so that someone or a family at the poverty level would pay no tax. Then, as income increases, taxes would increase. By the time income got to a couple hundred thousand, it would look more and more like 10% as the deductions became a smaller and smaller proportion of the total income. This would help the poor, encourage marriage and children – but the same law would still apply to everyone. A similar situation could be imagined for businesses.

A flat tax of 15 to 17 percent would probably generate about the same revenue as the current system. And the rich would pay more taxes than they do now (though Democrats would still claim that it’s a tax cut for the rich.) But everyone would have the same, understandable law.