Comment: Dear Sir or Madam: I am writing regarding the tax reforms that you will propose to the President. I have been a tax practitioner for 28 years and have a couple of suggestions. * I believe that you should consider a national sales tax (VAT) as a means of collectiong revenue from the underground economy. They spend money as well as honest taxpayers and this national sales tax would collect money from them anytime they made a purchase. I realize that a sales tax is regressive and therefore suggest the following ways to mitigate the impact: * No such tax would be imposed on purchases under $100 * All such tax collected would be treated as additional income tax paid to all who file a tax return. Each merchant would issue a 1099X for the tax collected. A taxpayer would attach this to their tax return in order to receive benefit for the tax collected. I realize that this imposes a burden on merchants. A possible solution is to have the taxpayer bring his/her receipts to an IRS office periodically and get the 1099X there. I realize the fraud potential in such an approach. While this solution has some problems I believe that it is a better method of collectioning from the underground economy than any I have seen in my years in practice * I believe that the burdens of tax season on both the government and practitioners could be significantly eased if we shifted from a calendar year to fiscal years for individuals. Years ago this would have been difficult to accomplish. With computers that is no longer the case. This would ease the cash situation of the govenrment (most returns filed in April result in refunds producing a large cash outflow for the government). It would aslo ease the processing burden for the government. Tax preparers would be able to better work if not under the great pressure that tax season produces. I would propose making taxpayers whose SSN ends in 1 have a Jan year end, 2 for February and so forth. I realize that this will take some doing to set up, but believe that in the long run everyone will benefit. I realize that the above are rough suggestions that will need to be fleshed out. I am available to discuss these ideas with you at your convenience. Very truly yours, Alvin J. Brown ________________________ Alvin J. Brown, CPA Gudvi, Sussman & Oppenheim 15260 Ventura Blvd., Suite 2100 Sherman Oaks, CA 91403-5360 Voice: 818-990-0550 Direct: 818-817-7407 Fax: 818-990-5707 www.gsogroup.com abrown@gsogroup.com |