Inglis Vows Support For Radical Overhaul Of Washington Budget, Tax And Entitlement Systems.

Press Release

U.S. Rep. Bob Inglis (R-SC) used the backdrop of a kindergarten classroom Tuesday to call on the post World War II generation to join him in radically reforming Washington tax, spending and budget policies so future generations are not robbed of the American promise of opportunity.

"Is it fair to ask these children to pay off our debts?" Inglis asked pointing to the Hampton Park K-5 class of teacher Luann Whitaker. "Is it fair for us to ignore these issues now, and ask these children to grow up in a country of staggering inflation, high interest rates and scarce jobs?"

Currently, all the country's business and individual tax receipts are sufficient to cover only the mandatory spending programs: Medicaid, Medicare, Social Security and interest on the debt. The rest of the federal budget to run all of the government agencies, the Department of Defense and two wars is borrowed.

Under the current trajectory, by 2040, mandatory spending will consume 90% of the budget -- clearly an unsustainable path.

The federal government is set to grow from a traditional 18-20 % of GDP to 40% by 2050.

"We need cut spending and reform entitlement spending to put the United States back on a path toward prosperity," Inglis said. "Key to this is reform of our tax structure for pro-growth taxation that does away with double taxation and income redistribution."

Under current tax rules, tax rates would have to climb to a top rate of 88% -- crippling the economy. Even raising $3 trillion in new taxes over the next 10 years would not close the deficit.

Yet, this year 47 percent of households paid no income tax. Fully 40 percent of U.S. households made a profit simply by filing their returns. And the top 10 percent of earners paid about 73 percent of the federal income taxes for the entire nation, according to the Tax Foundation.

Inglis said he is one of only 12 cosponsors of Rep. Paul Ryan's (R-WI) "Roadmap for the Future" plan. It would:

* Cap federal spending at 19 percent of GDP;
* Reform Medicare, Medicaid and Social Security to put them on a path of sustainability;
* Radically overhaul the tax system to give people a choice of a flat tax.

Under the tax overhaul the plan calls for offering taxpayers a choice. They can file under a two-tiered flat tax or the current 70,000--page system.

The flat tax would be 10 percent for incomes from $50,000 to $100,000 and 25% for incomes above. The personal exemption would be generous--$39,000 for a family of four. But there would be no exemptions, credits or loopholes. Dividends, capital gains and income from savings would not be taxed.

The tax reform measure would also do away with the Corporate Income Tax -- currently one of the highest in the world--and replace it with an 8.5 percent Business Consumption Tax or sales tax.

"Washington is trying to foster a culture of dependency," Inglis said, noting that more than 60% of Americans receiving more in benefits and services from the government than they pay in taxes.

"This is a violation of the tradition of America and the slippery slope toward the European welfare state."

Source