Time For A Better Tax System?

John Harwood in for Tom Ashbrook

On the eve of the tax filing deadline, we ask the question on everyone’s mind: Is this the best tax system we can come up with?

You’ve got until tomorrow to file your 2011 tax return. It’s a chore for everyone – and for many, a nightmare of complexity and uncertainty. Are we stuck with this 70,000 page tax code forever? Or is Washington finally going to give us a fairer and simpler one? President Obama says millionaires – like him and Mitt Romney — need to pay more.

But Romney says any tax increase would hurt our economy. Would lower rates for business create more jobs?

Up next On Point: The policy, and politics, of creating a new tax system.
-John Harwood

Margaret Collins, covers personal finance stories for Bloomberg News and Bloomberg Businessweek.

Neera Tanden, president of the Center for American Progress

Steve Bell, senior director of economic policy at the Bipartisan Policy Center

Yahoo Finance "President Barack Obama and his wife, Michelle, paid a 20.5 percent federal tax rate on $789,674 in adjusted gross income for 2011, according to tax returns released today by the White House."

New York Times "Taxpayers of all incomes would pay higher taxes. The Tax Policy Center says those in the bottom 20 percent, making about $8,500 a year on average, would pay 9.4 percent of their income in all federal taxes. This amounts to about 13 percentage points more than they do today (now they get a net credit). The average federal tax for those in the top 20 percent — families making $214,000 a year — would rise to 34.5 percent from 22.9 percent."

Reuters "Republican Mitt Romney, looking for a boost in his presidential campaign, proposed an overhaul of the tax system on Wednesday that he said would cut Americans' tax rates by 20 percent and limit deductions for the wealthy."

 Los Angeles Times "Both candidates claim they want "tax reform," but when they say those words, they're really talking about other things."