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The Flat Tax: Updated Revised Edition (Hoover Institution Press Publication) Paperback – March 17, 1995

4.4 4.4 out of 5 stars 19 ratings

This new and updated edition of The Flat Tax sets forth the flat-tax plan developed by Robert Hall and Alvin Rabushka, senior fellows at the Hoover Institution, who believe it is the most fair, efficient, simple, and workable plan on the table. The proposal taxes all income, once and only once, at a uniform low rate of 19 percent. It permits a tax-free allowance of $25,500 for family of four, thereby exempting many poor and lower-middle-income households from taxation. All wage earners would pay less tax than under the current system. The flat-tax plan tax returns can be filed on a postcard.

This flat-tax plan is not an academic abstraction. Hall and Rabushka have designed tax forms, rewritten the Internal Revenue Code, and worked out all the practical details. The plan has withstood the scrutiny of leading experts on taxation and has been enthusiastically endorsed by many of them. Both the New York Times and the Wall Street Journal have praised the flat tax. Both Republicans and Democrats have introduced it as bills in previous sessions of Congress.

Editorial Reviews

Amazon.com Review

Here's the book that started the flat tax debate back in 1985, updated in an edition for the 1990s. Robert Hall and Alvin Rabushka present their plan as fair, efficient, simple, and workable. All income in the United States would be taxed once at the rate of 19 percent, and there would be generous allowances for families. This system and its postcard-sized tax form would wipe out $100 billion in annual compliance costs and demolish the Washington culture of lobbyists, whose entire industry depends upon tampering with the rules of free enterprise.

Product details

  • Publisher ‏ : ‎ Hoover Institution Press; Second Edition, Revised (March 17, 1995)
  • Language ‏ : ‎ English
  • Paperback ‏ : ‎ 148 pages
  • ISBN-10 ‏ : ‎ 0817993126
  • ISBN-13 ‏ : ‎ 978-0817993122
  • Item Weight ‏ : ‎ 8.8 ounces
  • Dimensions ‏ : ‎ 6.25 x 0.5 x 9 inches
  • Customer Reviews:
    4.4 4.4 out of 5 stars 19 ratings

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4.4 out of 5 stars
19 global ratings

Top reviews from the United States

Reviewed in the United States on August 18, 2011
The 60,000 page tax code itself is the issue, not another tweak or incentive in the way of tax rates, credits, deductions, or what not. The uber rich (including Warren B and Bill G) pay VERY LITTLE as it stands now because of how the code protects those who have concentrated, inherited, or sudden wealth. For just one example, just set up a qualified multigenerational family foundation, put a big chunk of appreciated stock in it, and you avoid the majority of capital gains, income, and even estate tax - forever! The world of trusts and foundations is murky to most people, and the truly rich (as opposed to very high income workers/business owners - VERY different people) depend on your ignorance of how the code really works to perpetuate class warfare that in the end will leave them right where they are. Yes, it's the new American Aristocracy.

The only real answer to spur the economy and solve the deficit at the same time is a true flat tax with no or extremely limited deductions, with the first $40K (or whatever a living wage is) non-taxable for everyone.
Fair? Yes. Progressive versus what actually exists in practice today? Absolutely.

I laughed and cried when I read of Warren Buffett's recent plea to raise income tax rates for the super rich. I'm not sure Warren would like a truly flat tax as it would actually touch him. Put another way, raising the top bracket to 50% or so still wouldn't really affect him, since his 'income' is for the most part sheltered and never shows. Do the math with me - WB's $6.7M tax bill last year divided by his liquid net worth works out to about .1%, not the 'only 17%' (?!) of his income that he claims in his op-ed. Most of his net worth has not been and will not ever be taxed under the current code. Buffett's statements about the rich paying their fair share yesterday were intellectually dishonest in my opinion.

Read this classic if you actually want to be informed on this issue - they've covered all the objections you can think of, and more. Anything that Jerry Brown and Ronald Reagan agreed on might be worth a look.
Now, if only someone somewhere had the charisma and political will to actually pull such a thing off, given that legions of lobbyists, CPAs, bankers, investment advisors, etc. etc. etc. would do everything they could possibly do to kill any such reform since it would negatively affect their businesses.
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Reviewed in the United States on May 27, 2012
The United States tax system is insane. At over 70000 pages and counting, it's impossible for any person to fully understand it. It's riddled with loopholes and special cases, inserted over the years by politicians larding their bills to attract votes. Its incentives distort individual choices by making evasion and avoidance more attractive, it stimulates rent-seeking, and it's spawned entire industries devoted to addressing the deadweight loss from its complexity. It is almost thoroughly unlikable, and it's a system no one would ever design.

This book presents an alternative tax system: the flat tax. The flat tax strips away nearly all the complexity of the current tax code, reducing the entire tax system (with a couple exceptions like the social security tax) to a handful of figures and simple calculations, stripping away nearly all special cases to eliminate loopholes and opportunities for unequal treatment. The authors reduce the entire code to a mere seven very short pages of text, understandable by any financially-savvy person. The tax forms themselves are the size of postcards.

Robert Hall and Alvin Rabushka here present the rationales for the flat tax, the logic behind it, the details of how it would work, and common questions and answers about it. They labor at some length to present the complete details of the system. It's technical reading you can't simply breeze through: you'll have to work a little to understand it all, and it's best digested slowly. But any intelligent person with a little mathematical skill and mind for finance will come away from this book with significant understanding of exactly how the flat tax would work. That definitely cann't be said of any book that will ever discuss the current tax system.

Merits or demerits of the proposal aside, this presentation of the flat tax is excellent. If you want to understand the flat tax, whether to praise it, to bury it, or simply because you want to be better-informed, this is the book to read.
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