TaxProf Blog

Editor: Paul L. Caron, Dean
Pepperdine University School of Law

Friday, February 10, 2006

WSJ: Rhode Island Flat Tax

Interesting editorial in today's Wall Street Journal, Rhode Island Revelation:

Let's hope James Carville, Robert Rubin, Nancy Pelosi and other national Democrats are all sitting down for this one: The Rhode Island legislature is considering a flat tax, and the proposal comes from its majority Democrats. That's right, last week Ocean State Democratic leaders proposed an optional flat rate income tax of 5.5% as an alternative to the current "progressive" tax schedule, which imposes rates ranging from 3.75% to 9.9% for the highest earners....

All of this ought to be especially instructive to national Democrats, who typically confront tax cuts with garlic and crosses. It's especially useful to have liberals underscoring that marginal income tax rates matter to incentives, and can drive both investment and workers into lower-tax venues. California and New York liberals still haven't figured that out.

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