This year Americans will pay accountants and attorneys $140 billion to do their taxes and help them navigate the 46,000-page U.S. Tax Code. Too bad, U.S. observers say, that they dont have the Russian tax system.
The majority of Russian taxpayers don’t need to submit tax returns. The 13 percent rate has exceeded expectations in terms of revenue, as real rouble revenue increased 28 percent.
In other pro-market moves, President Vladimir Putin has signed legislation to cut the corporate tax rate from 35 to 24 percent. The Kremlin may also offer Russians privately invested social security accounts.
As one observer has noted, V.I. Lenin, analysing all this from his dacha in hell, must be stroking his beard in utter bewilderment.
Source: Deroy Murdock, Even Russia Realised the Wisdom of a Flat Tax, Dallas Morning News, March 4, 2002.
For more on Russia http://www.ncpa.org/iss/int
RSA Comment:
In its evidence to the Parliamentary Portfolio Committee on Finance, the FMF questioned the wisdom of instituting Capital Gains Tax in South Africa, and proposed a flat tax system as a superior alternative. Dr Alvin Rabushka, one of the authors of The Flat Tax, maintains that governments are advised on tax matters by the very people who make their fortunes out of guiding people through the intricacies of a very complex tax system. The tax collectors also have a significant vested interested in complexity. This coalition of interests will consequently never recommend a simple, low flat tax, even if such a tax would encourage investment, spur entrepreneurial effort, dramatically reduce avoidance and evasion, cut collection costs, and raise higher revenues.
Eustace Davie, Director, FMF
FMF Policy Bulletin\12 March 2002
