A Tax Reform to Kick-Start the Economy: Laurence Kotlikoff
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Aug. 31 (Bloomberg) -- Our economy desperately needs aswift kick in the pants, one that delivers millions of jobs andextra tax revenue. A sweeping, pro-growth tax reform, which Icall the Purple Tax Plan, is the ticket. It would boostgovernment coffers by 20 percent over time and make both redRepublicans and blue Democrats happy.
The plan does four things. First, it makes the regressivepayroll tax progressive. Instead of taxing workers and theiremployers at a combined 15.3 percent rate up to $106,800 and ata combined 2.9 percent above the ceiling, the plan levies theemployee half of the tax only on earnings above $40,000 andeliminates the ceiling. This is something the Democrats can crowabout.