Jimmy Carter on Tax Reform

President of the U.S., 1977-1981

1970s: Tried to extend withholding to interest and dividends

The reality of April 15 as we know it under the withholding scheme, instead of being a day when Americans are focused on what the government is costing them, most of us are instead focused on how much we're getting back from that government.

Since 1943, there have been plenty of efforts to expand the withholding scheme. In the 1970s, Pres. Carter attempted to have withholding extended to interest and dividends. This time Americans seemed to understand that having taxes withheld on their interest and dividend earnings before those taxes were actually due would cost them additional earnings. The effort failed, but it was revived a few years later in 1982. With the enthusiastic support of Pres. Reagan, politicians cited the budget deficit as a reason to expand withholding to include dividends and interest earnings. Congress authorized the additional withholding measure in 1982 but it was repealed a month after it went into effect.

Source: The FairTax Book, by N.Boortz & Rep.J.Linder, p. 29-30 , May 31, 2006

Congress uses tax law as goodies for special interests

I found through bitter experience that any tax proposal-including our welfare and tax reform packages-attracted to Capitol Hill a pack of powerful and ravenous wolves, determined to secure for themselves additional benefits at the expense of other Americans.

It was a perennial temptation for Congress to pass tax legislation that was a Christmas tree full of goodies for special interests. In this insidious game, the number of votes available to the sponsors of a tax bill were almost exactly proportional to the number of loopholes added to the legislations.

A doubtful group of representatives would say, "Well, I don't like the bill very much. It doesn't help the miners (loggers, catfish growers, homebuilders, steel industry, beekeepers, oil drillers, small businessmen), and there are a lot of them in my district." Another little section is added to the bill. Only repeated threats of my veto prevented the greedy lobbyists from reaching their goals.

Source: Keeping Faith, by Jimmy Carter, p. 84 , Jun 24, 1977

Reform tax structure without tax increases

Our tax structure is a disgrace and needs to be reformed. As Governor of Georgia for four years, we never increased sales taxes or income taxes or property tax. As a matter of fact, the year before I went out of office we gave a $50 million refund for the property taxpayers of Georgia. Source: A Government As Good As Its People, by Jimmy Carter, p.240 , Oct 1, 1976

Shift the tax burden away from low- and middle-income groups

Carter says that our national tax system is a "disgrace," He advocates tax reform "not to soak the rich but as a program that would soak the people who don't pay their fair share of taxes. I'm a wealthy man myself. But I want a simple equitable tax system that would shift the tax burden away from low- and middle-income groups."

The simplified more progressive tax rate system Carter envisions would eliminate most deductions (including those on home mortgage payments) and would treat all personal income the same. It would modify corporate taxes to discourage corporations from moving their operations to other countries. A detailed comprehensive program of tax reform would not be forthcoming until he would be in office for at least a year.

Source: Jimmy Who?, by Leslie Wheeler, p.193 , Jan 1, 1976

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