Iowa Republican Senator Chuck Grassley says changes to the complex federal tax code could be coming this year. Grassley is a member and former chair of the Senate finance committee. He's long-advocated for a tax system with fewer rates.
"If we were going to have a simple reform, we would have one tax rate, with an exemption for low and middle income people," he says. One figure for that cut-off, which he says is often used, is $36,000, after which workers would be subject to a flat tax.
Grassley says although it would lower the tax rate for many people, ultimately the government would collect more money.
"What you end up getting with lower tax rates is more taxpayers," Grassley says, "because there aren't enough wealthy people in this country to finance all the government that a lot of liberals want to foist upon the American people."
Grassley says lower rates also encourage small business and he cites both Democratic and Republican administrations that historically have increased tax revenue through lower rates on more taxpayers.
House Speaker, Paul Ryan, a Republican, seems willing to take up tax reform, Grassley says. But Grassley also recognizes that popular credits, like for charitable giving, can quickly complicate an otherwise simple-seeming proposal.
