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NEWS
[ Friday, March 27, 1992 ]

Brown advocates flat 13 percent income tax

Collegian Staff Writer

In an attempt to strike a chord with voter disapproval of Washington bureaucracy, Jerry Brown's domestic platform proposes new ideas for dealing with the economy.

One of Brown's most innovative ideas is his flat tax rate. Instead of the current federal tax system, all taxpayers would pay a tax rate of 13 percent to promote a fairer and less complex tax structure.

Brown, the former governor of California, would eliminate taxes and all other sources of government revenue and replace them with flat-rate taxes.

"Despite the low rate of 13 percent, federal revenues would be at least as much as they are today and probably much higher if this revamping of the tax code unleashes the business expansion we expect," according to the news release.

The flat tax more specifically means the elimination of the personal income tax, social security tax, corporate tax, gift and estate tax, gasoline tax and federal excise taxes.

Individuals would report all of their income without deductions, exemptions or exclusions with the exception of mortgage interest, rent payment and charitable donations.

In addition, the business income would place a single tax on value added from labor, capital and land. Businesses obtain the tax base by taking its total sales and subtracting its purchases from other businesses that pay taxes.

According to the news release Brown said the plan has great potential.

"The 13 percent flat tax reform is the only new idea to emerge from this year's presidential campaign. With it, the stock market will go through the roof, businesses will thrive and millions of Americans will go back to work," according to Brown's news release.

Peter Bohn, Centre Region coordinator of the Brown campaign, said the flat tax prevents using the existing code as a source of political corruption in which lobbyists manipulate adjustments and inequities in the tax system to purchase influence.

Bohn said businesses would stimulate investments since the consistency in the tax structure would spur growth and provide clearer guidelines for businesses. He also said people with lower incomes gain from the flat tax.

"They would benefit since they pay a higher proportion of their income on taxes," Bohn said.

Other economic development plans include the use of alternative energy, which Bohn says would, among other things, reduce energy waste and create more jobs.

Bohn also said that Brown proposes enterprise zones in depressed cities by substituting welfare payments for job vouchers.

"This would get them into the workforce by getting them off welfare instead of going through the bureaucracy," Bohn said.

 



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