ardent jd: I agree that a no deductions allowed rule for a wage earner can work. But, add a rental or two and a sole proprietor's income and you are right back to the measurement issue. Would you apply the flat tax rate to gross rental receipts? Would you tax a doctor's $500,000 in gross receipts or would you allow deductions for wages paid to office staff, depreciation for diagnostic equipment (over how many years and what method?), office supplies, etc.? Let's say that at the end of the year the doctor nets $200,000 after paying expenses. Is that what would be taxed?
I've never done a Massachusetts tax return but I'll bet that state taxable income is derived from federal income. The measurement has already been done under federal tax law.
The point I was/am trying to make is the problem of defining the tax base. That's what tax law is about and, I fear, it will never be free of meddling by public policy makers.
I hope my response isn't viewed as defensive. It's easy to talk about flat tax as simplifying life for everyone, but not so easy in the details.
Bob McP
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