Tax Reform Popular with Farmers
By Stewart Truelsen
Steve Forbes was a leading proponent of tax reform during his ill-fated run for the 1996 Republican nomination for president. Eventual nominee Bob Dole, picking up the tax reform banner, proposed a 15 percent tax cut, but still lost to President Clinton. Was tax reform overrated as a political issue? Not with farmers and ranchers.
If the Kansas Farm Bureau annual meeting is any indication, farmers consider tax reform a top priority. A standing-room only crowd of over a thousand farmers listened intently as Forbes renewed his message of a major tax overhaul.
"Just look at the tax bill a family pays today," said Forbes, "The typical American family pays eight times as much tax on each dollar of income as a typical family 45 years ago." Forbes called the complexity of the tax code a "horror" and added that the only way to remedy the situation is to "drive a stake through its heart, bury it and hope it never rises again to terrorize the American people."
Forbes' description of the current tax system as a monster is certainly recognizable to farmers. His flat-tax proposal would eliminate inheritance taxes which often stand in the way of farmers passing their farms on to the next generation.
Farmers may not subscribe to every aspect of Forbes' plan, and that's not important to him. He admits there are numerous plans on the table that lead to the same thing--more fairness and less complexity in the tax system. The goal of all these plans is to tax all income once, but only once, and to lessen the burden on income that is saved and invested.
In the case of estate taxes, the income was already taxed once when it was earned. Why should it be taxed again when transferred at death from one owner to another? Farmers and other businessmen would also like to see elimination or a reduction in the capital gains tax.
With the economy performing reasonably well, Americans were just not ready to embrace a great deal of tax change. The truth of the matter is that most of us are so busy working to pay taxes, we haven't stopped to figure out the extent to which we are paying.
After his speech, Forbes admitted to reporters that the outlook for the flat tax is not good in the next four years of the Clinton administration. But he thinks this president could be turned around if public opinion mobilizes around a fairer tax system.
The current system which no one can understand is "bureaucracy's biggest hold on the American people," according to Forbes. If it's any help, the Kansas Farm Bureau gave Forbes a very heavy sledge hammer with the inscription, "Time for Reform" engraved on it. He plans to stay in the public eye next year and wield that sledge hammer.
Stewart Truelsen is director of broadcast services for the American Farm Bureau Federation.