Flat Tax: An Idea Whose Time Has Come

No, not here in America, but in Eastern Europe. Albania and Bulgaria will be instituting a flat tax next year, joining Estonia, Latvia, Lithuania, Russia, Serbia, Ukraine, Slovakia, Georgia, and Macedonia, who have already done so. The Czech Republic and Montenegro plan to join the club in the next few years.

The results of the flat tax have been astounding. A former economic backwater like Slovakia has seen skyrocketing job growth, a 9% GDP rate last year, the unearthing of its underground economy, and billions in investment from the likes of Hyundai and Sony.

This simple, straightforward approach to financing government provides a stark contrast to the socialist economies of Western Europe — and, increasingly, the U. S.

Global legal expert David Storobin considers the flat tax the mark of a New Europe. “Tax reforms in Eastern Europe are having a tremendous effect on Western European economies, as companies are bound to move to neighboring states to avoid paying the near-confiscatory taxation (especially when you combine the income tax with corporate, capital gains and dividend taxes) levied in the ‘Old Europe’ to support the Welfare State system.”

I doubt that I will ever see it implemented in America in my lifetime, but it’s reassuring to know that it’s not just theory.

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