Kyl predicts two-year extension of Bush tax cuts

“[The] most likely scenario in this divided Congress is a temporary extension of current rates for all Americans, probably for two years,” he wrote in The Wall Street Journal, adding that debate on the tax cuts should spur movement toward overall tax reform. 

“Congress must seize this opportunity,” he wrote. “We should get to work on a bipartisan, comprehensive pro-growth tax reform that would be implemented at the end of the two-year period.” 

Reform talks have already begun in the Senate, and House Ways and Means Committee Chairman Sandy Levin (D-Mich.) plans to begin discussions on the topic early next year.

Once reform talks begin in earnest, businesses should be willing to exchange some of their preferences for a tax rate that is competitive with other countries, Kyl wrote. 

“Similarly, the individual side of our tax system is far too complicated,” he wrote. “Americans of all income levels and family situations would benefit from a flatter (but still progressive) rate structure that includes few preferences.” 

Kyl appears to suggest a tax system that contains lower rates but affects a broader base. A similar strategy was enacted in 1986. 

“Every American with an income should pay some level of taxes. Why? Not to raise additional revenue (the rate should be very low and payment simple), but because every American should have a stake in the cost and size of our government,” he wrote. 

Kyl also called for estate tax reform. In the past, he has championed a measure that applies a 35 percent tax to estates worth more than $5 million.