Commentary: A Flat Tax Is Flat Out Risky

America's latest tax revolt is gathering momentum. Multimillionaire Steve Forbes has launched his GOP Presidential bid with an all-out assault on the federal income tax. Representative Bill Archer (R-Tex.), the powerful chairman of the House Ways & Means Committee, wants to "pull the income tax out by its roots so it can never grow again." The recent report of the GOP-chartered Tax Reform Commission, chaired by supply-side cheerleader Jack F. Kemp, argues that "the current tax code cannot be revised, should not be reinvented, and must not be retained." It's time, they tell us, to begin anew.

Right now, in the vanguard of the movement to replace the 83-year-old income tax is the 17% flat-rate tax championed by Forbes and House Majority Leader Richard K. Armey (R-Tex.). Thus far, the debate over the flat tax has revolved around the politically explosive question of income distribution. By design, a flat tax reduces the load on the wealthy by exempting from personal taxes interest, dividends, and capital gains. Flat-tax advocates justify the move by claiming a dramatic economic payoff. Although it shied away from endorsing a flat tax, the Kemp Commission predicts a doubling of the nation's growth rate with a switch to a single-rate system.