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Center for Freedom and Prosperity Foundation For Immediate Release CF&P Foundation Releases Study on the (Washington, DC, Friday, February 29, 2008) – The Center for Freedom and Prosperity Foundation has released a new study it its educational series on global tax policy. Entitled the "The Global Flat Tax Revolution ~ Lessons for Policy Makers," the study – authored by Cato Institute Senior Fellow Daniel Mitchell – documents the dramatic shift to single-rate tax systems, particularly in the former Soviet Bloc. There are now 24 jurisdictions with some form of flat tax, and the evidence confirms that these simple and fair tax systems are promoting faster growth and higher incomes. Moreover, thanks to tax competition, the number of nations with pro-growth tax systems is expected to grow. Link: The Global Flat Tax Revolution PDF Version: "The success of the global flat tax revolution is very encouraging," said Andrew F. Quinlan President of the CF&P Foundation . "American policy makers should pay close attention to the positive economic consequences generated by these reforms. As the global flat-tax revolution spreads, jurisdictional competition will likely compel high-tax nations to reform their tax codes in order to remain attractive for investors and entrepreneurs," Quinlan added. Commenting on the CF&P Foundation's studies on tax systems from around the world, Mr. Quinlan noted, "These studies illustrate the wisdom of good tax policy – and the perils of bad policy. The Center has undertaken this project in hopes that policy makers learn from the important tax changes that are taking place around the world." Note: Over the next few months, the CF&P Foundation will release several papers reviewing the tax systems of selected countries, including Russia, France, Ireland, and the United Kingdom. The five previous published papers in the series were on the tax systems of Sweden, Slovakia, Switzerland, Hong Kong and Iceland. Links to previous tax system studies: http://www.freedomandprosperity.org/Papers/sweden/sweden.shtml Executive Summary Thanks largely to tax competition, governments are dramatically improving tax policy. Over the past 30 years, tax rates on productive activity have been sharply reduced. Personal and corporate income tax rates have been slashed. Capital gains tax rates, wealth taxes, and death taxes have been lowered or eliminated. These pro-growth reforms have boosted the global economy, lowered poverty, and improved living standards. Perhaps the most exciting development, though, is the flat tax revolution. The number will probably be higher by the time you are reading this, but as this article went to press, 24 nations have adopted some form of single-rate tax regime. These reforms have generated impressive results, including faster growth, more jobs, and increased competitiveness. While politicians generally are most concerned about losing tax revenue, they should not worry. Flat tax systems oftentimes generate higher tax revenues because of more income and better compliance. The economic consequences of tax reform are positive, but the political implications also are profound. Governments are deciding – in part because labor and capital can cross national borders to escape punitive tax rates – that it no longer makes sense to discriminate against highly-productive taxpayers. Thanks to tax competition, expect the number of flat tax countries to continue to grow. Link to paper: You can view all our published papers at http://www.freedomandprosperity.org/fpf/prosperitas/prosperitas.shtml For additional comments: Andrew Quinlan can be reached at 202-285-0244, andy@freedomandprosperity.org
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