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Is Tax Reform Ahead?

Today’s post is by Randy Russon, founder of TOPCFOS

This is Randy Russon and welcome to our Blog today. TOP CFOS offers the finest CFO consulting service anywhere in the world to companies who want to take their organization to the top. We absolutely love being a part of your success. We also love to be the catalyst behind your firm’s soaring profits! Today’s post comes from the Government category on our website and is entitled Is Tax Reform Ahead?

In writing this post, I was curious to know when taxation first began here in the United States. President Abraham Lincoln was actually the first U.S. president who started taxing the people in 1862. Quoting from the IRS website called Historical Highlights of the IRS, they say, “President Lincoln signed into law a revenue-raising measure to help pay for Civil War expenses. The measure created a Commissioner of Internal Revenue and the nation’s first income tax. It levied a 3 percent tax on incomes between $600 and $10,000 and a 5 percent tax on incomes of more than $10,000.”

Since then, our nation’s tax code has grown to over 75,000 pages in length. Can anyone really begin to comprehend the complexity of this code? The IRS itself has acknowledged this issue when they said, “The most serious problem facing taxpayers is the complexity of the Internal Revenue Code”. They go on to further state, “The largest source of compliance burdens for taxpayers – and the IRS – is the overwhelming complexity of the tax code. The only meaningful way to reduce these burdens is to simplify the tax code enormously.”

I have always been of the opinion that simple is better. The less complicated you can make something the better it is for everyone. So, why not apply this same line of thinking to our nation’s tax code? The IRS is simply an extension of our lawmakers. So, we look to them to solve this dilemma our nation faces. I recently saw some articles that gave me hope that tax reform might be on the horizon.

Both of these articles came from Checkpoint® Newsstand published by Thompson Reuters® The first article is entitled, “U.S. Senate’s Hatch sees Support for Tax Reform”. And, the second one is entitled, “Obama Administration pushes Business Tax Reform in Congress“. Then, from The United States Senate Committee on Finance website, we read “Hatch Outlines Seven Principles for Comprehensive Tax Reform”. Senator Orrin Hatch (R-Utah) is the chairman of the United States Senate Committee on Finance. And, he is working hard for tax reform.

When I start seeing announcements such as the forgoing, this gives me hope that change might be on the horizon. How nice it would be to begin the process of simplifying our nation’s tax code. Hatch has also said he is in favor of reducing the corporate tax rate which now stands at 35% on the high end. He is further in favor of eliminating most if not all taxes on foreign profits of U.S. corporations as well.

One of the services our firm provides is that of preparing business taxes for our clients. How nice it would be to see the corporate tax rate come down. This would do so much to help stimulate growth and economic activity. When President Abraham Lincoln first started taxing the people of this nation in 1862, the high end stood at 5%. Wouldn’t it be nice to return to this level? Think of how this would help stimulate business growth and expansion!

We hope you’ve enjoyed our Blog today. Please remember, TOP CFOS offers the finest CFO consulting service to companies anywhere in the world and would love to be a part of your team. Feel free to reach out to us anytime. Your feedback is most welcome, and we invite you to share this post with friends and associates. Our contact information can easily be found on our website at topcfos.com. Our next post will come from the Human Capital category on our website and is entitled Employees – one of Your Greatest Resources. And, thank you for joining us!