FOR IMMEDIATE RELEASE
Friday, March 2, 2007

Isakson Introduces Legislation to Repeal Tax Code by 2010
Requires Congress to Reauthorize Current Tax Code or Replace It with New System;
Flat Tax and National Sales Tax Must Be Considered Among Options

WASHINGTON – Declaring that it's time to give relief to American taxpayers, U.S. Senator Johnny Isakson (R-Ga.) has introduced legislation to repeal the U.S. tax code by 2010 and to force Congress to vote to reauthorize it or replace it with a new system.

Isakson's bill also creates a bipartisan commission that would be required to examine and to recommend to Congress plausible replacements for the tax code. A flat tax and a national sales tax must be among the options it examines, under Isakson's legislation.

“Back in Georgia, we have a saying when people are always treating the symptom and not treating the cause. We say they're avoiding the 800-pound gorilla in the living room,” Isakson said on the Senate floor. “Well, we have a six-pound gorilla that's in the United States Capitol. It's called the U.S. tax code. Printed in the eight-point type, the U.S. tax code weighs six pounds, but the burden is more than an 800-pound gorilla on the back of American business and on the back of American families.”

The Tax Code Termination Act would terminate the current tax code on December 31, 2010. To ensure a smooth transition to a new system, Congress must approve a new tax code by July 4, 2010. If a new system is not approved by July 4, 2010, Congress would be forced to vote to reauthorize the current tax code. 

To help Congress choose the best replacement system, Isakson's bill creates a bipartisan commission to analyze reform options and report its findings to Congress. The commission would review the impact of the current tax code on the economy, families and workers; the compliance costs to taxpayers, small business and corporations; and the Internal Revenue Service’s ability to administer the current code.

“Why not get a distinguished commission of learned people to sit down for a protracted period of time, analyze what's right for this country and make recommendations to us,” Isakson said. “Have thoughtful people, who are knowledgeable and understand the tax code as it is, make the recommendations on what might make it better. What we need most is simplicity, fairness and equity.”

The commission would also be required to consider specifically whether the income tax should be replaced with a flat tax, a national sales tax or another option. The commission also would be required to identify the transition costs associated with any change to the present federal tax code.

The commission would also be required to report on the potential impact of any new system on the U.S. economy and on the government’s ability to collect revenue. Additionally, the potential impact of any new system must be presented and reviewed from both static and dynamic scoring models.

The bill will create a National Commission on Tax Reform within the legislative branch, consisting of 19 members. Four of the members will be required to come from businesses with fewer than 50 employees. The commission will be appointed by the president, the Senate Majority Leader, the Senate Minority Leader, the Speaker of the House and the Minority Leader in the House.

Original co-sponsors of the legislation include Sens. Saxby Chambliss (R-Ga.), Wayne Allard (R-Colo.), Mike Crapo (R-Idaho), Lindsey Graham (R-S.C.) and David Vitter (R-La.).

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