Stealth Tax

No doubt you have heard that a lot of government officials in Washington and their supporters in the press would like to undo the indexing provision in the tax code, due to take effect in October 1985. (Indexing adjusts tax brackets to offset inflation. As things stand, higher nominal incomes move us into higher tax brackets, even though purchasing power remains the same.) Indexing is supported by President Reagan and Senator Bob Dole, among others, and opposed by Senators Howard Baker and Pete Domenici, and by the House Democratic leadership.

Since indexing merely protects us from non-legislated tax increases, those who oppose it dispense with the sermons and moralizing that normally accompany political advocacy. David Broder, the Washington Post’s political editor, who has moved sharply to the left in the past 18 months, wrote one column in which he simply dismissed indexing as “foolish.” No argument needed, apparently—just the familiar sneer from the left. The government is about to forgo its opportunity to collect taxes extra-legally? How foolish!

TB

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Tom Bethell

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No doubt you have heard that a lot of government officials in Washington and their supporters in the press would like to undo the indexing provision in the tax code, due to take effect in October 1985. (Indexing adjusts tax brackets to offset inflation. As things stand, higher nominal incomes move us into higher tax brackets, even though purchasing power remains the same.) Indexing is supported by President Reagan and Senator Bob Dole, among others, and opposed by Senators Howard Baker and Pete Domenici, and by the House Democratic leadership.

Since indexing merely protects us from non-legislated tax increases, those who oppose it dispense with the sermons and moralizing that normally accompany political advocacy. David Broder, the Washington Post’s political editor, who has moved sharply to the left in the past 18 months, wrote one column in which he simply dismissed indexing as “foolish.” No argument needed, apparently—just the familiar sneer from the left. The government is about to forgo its opportunity to collect taxes extra-legally? How foolish!