LARGENT KEYNOTES FIRST GLOBAL INSTITUTE FOR TAXATION CONFERENCE

Congressman Steve Largent (R-Okla.) spoke at the first conference of the Global Institute for Taxation (GIFT), sponsored by St. John's University and PricewaterhouseCoopers, on October 1 and 2 in New York City. The theme was "Taxation Alternatives for the 21st Century," and participants from around the world spoke with passion and enthusiasm about alternative tax systems and the need for tax reform.

Because the House was still in session, Congressman Largent spoke from Washington via interactive teleconferencing technology. While not advocating a specific tax system, he promoted the benefits of H.R. 1041, the Date Certain Tax Code Replacement Act of 1999, which he introduced into the House on March 8. Largent, supported by more than 100 of his colleagues, introduced the bill on the 86th anniversary of the modern-day income tax. The bill is intended to force a debate on the need for tax reform and alternative tax systems by terminating the existing tax code on December 31, 2002. Largent expects that the House will pass the bill this Congress, as it had last Congress and, according to Largent, begin the process of "lifting the enormous burden the code places on taxpayers."

"Any alternative system of taxation must eliminate the most onerous taxes in our current system, such as marriage taxes, death taxes, Social Security benefit taxes, and capital gains taxes," Largent said. "It must also give taxpayers a clearer view of the cost of the Federal government, helping to make government more accountable and reduce its size and power."

The bill would require that a new tax system be legislated by July 4, 2001, in order to be fully operational by January 1, 2003. The bill is necessary, according to Largent, because the Washington establishment likes the existing tax systems and must be forced to completely and openly address new possibilities.

The conference featured a number of panel discussions and academic paper presentations. Flat taxes and consumption taxes received appropriate coverage. Other forms of taxation, such as the land and debit taxes, were proposed by some as better solutions. The theory behind the land tax is that the value of land is derived from the actions of government, society, and perhaps nature, and therefore landowners should be taxed on its value. The stated benefits are that land will be put to its highest and best use while keeping market values low. The debit tax is a tax on debits to cash accounts. Imposed at a low rate, it taxes spending and therefore promotes saving.

Professor Dale Jorgensen of Harvard University addressed the conference on the prospects for continued growth in the economy and the desperate need to create greater incentives for saving. In his view, a tax system that promotes saving is essential to economic growth.

Conference chair and GIFT founder Patrick Colabella commented after the event: "I am extremely pleased with the program's high level of participation and the quality of the papers presented." *

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