Ultima Thule

In ancient times the northernmost region of the habitable world - hence, any distant, unknown or mysterious land.

Wednesday, March 02, 2005

Bartlett touts the flat tax in the former Soviet bloc countries

By Aussiegirl

Bruce Bartlett, economist extraordinaire, loves the flat tax schemes being implemented in former Soviet countries like Ukraine, and he explains why. Could it be that it is like Yushchenko recently said, the taxes will be low, but everyone will pay them? Gee - you know, it might even work here, ya think?

Bruce Bartlett: The flat tax in the old Soviet bloc:

Hoover Institution political scientist Alvin Rabushka points to eight different countries in the former Soviet bloc that have adopted some form of flat tax in recent years. In addition to Russia and Slovakia, they are Romania, Georgia, Estonia, Latvia, Serbia and Ukraine. He predicts that Poland and the Czech Republic will soon joint them.

Why so much interest in the flat tax? A key reason is that it is far more effective at raising revenue than progressive rates. With progressive rates, it looks as if extra revenue is being extracted from the wealthy. But it is also giving them a powerful incentive to arrange their affairs so as to minimize their tax liability or to evade taxes altogether.

With a flat tax, there is much less incentive to engage in tax avoidance or tax evasion. "

1 Comments:

At 11:58 PM, Blogger Pindar said...

This is an interesting article, and makes the prospect of a flat tax very appealing. Since Bartlett is, in Aussiegirl's great phrase, an "economist extraordinaire", I think we can trust his judgment here. And just think of how much easier such a tax would be--why, it might make filling out your 1040 even fun!

 

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