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What Is Really Happening to Government Revenues: Long-Run Forecasts Show Sharp Rise in Tax Burden

Instead of raising taxes even faster than projected in an effort tocatch up with out-of-control spending, the wise course is to tacklethe explosion of entitlement spending and continue to enact taxreforms and reductions to hold the long-term tax burden at thehistoric level that has been a key to America's economic success. ....

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A "Supply-Side" Success Story

Why is the 2003 tax cut working so much better than the 2001 taxcut? ....

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Making American Companies More Competitive

A "territorial" tax system that taxes only income earned insidenational borders would allow U.S.-based companies to compete on alevel playing field with foreign competitors, particularly ifaccompanied by a significant reduction in the corporate tax rate.If Congress lacks the political will to engage in fundamentalreform, it should at least go as far toward a territorial taxsystem as possible. ....

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Tax Rate Reductions Strengthen the Economy, But Excessive Government Spending Threatens Long-Run Performance

To enhance economic performance, Congress should make thepro-growth portions of the Bush tax cuts permanent, implementreforms to shift the Internal Revenue Code closer to a simple andfair flat tax, cap the growth of federal spending, eliminateprograms or devolve them to the state and local levels, reformentitlements, and use cost-benefit analysis to rein in regulatoryexcess. ....

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