Letter: Indiana tax system needs major overhaul

To the editor:

Shortage of tax revenues and the unfairness of Indiana taxes continue to be front page news yet legislators keep their heads in the sand pit of denial and wishful thinking. It is time for the right-wing mantra and pledge of “no new taxes” to go into the trash barrel.

The entire tax system of Indiana needs a major overhaul, not more Band-Aids. Indiana has more than a hundred different taxes on businesses and individuals with government departments to match. In addition it has a flat-rate income tax as well as a sales tax that creeps onto more and more items. Both of these are grossly unfair tax methods, as is the property tax system at the local level.

Major savings in government administration, business overhead and personal tax preparation could be achieved along with enough resources for state and local government operations and public schools by replacing the current mishmash with three tax methods –- excise taxes and a graduated income tax for state funds and a gross receipts tax for local government funds and schools.

Since everyone, including churches, nonprofits, retirees and renters benefit from local services, they should not be exempt from the gross receipts tax, which could be as small as 1.5 percent if it’s applied across the board with no exceptions or deductions.

In navigation you learn that if you try to change course in small increments, you end up going in circles. The secret to changing course is to make a big correction and then make refinements. Incremental changes merely multiply the pain instead of getting it over with in one fell swoop.

Politicians still don’t understand that principle also applies to government.

Donald A. Smith