Abolish the Alternative Minimum Tax (Fourth in a Series)

If double taxation is immoral, AMT may well be the chief of sinners.

by Rod D. Martin
April 5, 2004

In my continuing series on the need for a flat tax system for America, I've identified five essential reforms to help us break away from our current system of tax oppression and wealth confiscation.

Recently, I made the case for one of these proposals -- eliminating the double tax on capital gains.

Today, let's explore the case for abolition of the Alternative Minimum Tax, or AMT.

Concocted in 1969, AMT requires both wage earners and businesses to re-compute their tax deductions if the IRS deems these deductions “too numerous” relative to income.

Few Americans have ever heard of AMT, but that will likely change soon. In terms of its effect, AMT is like the proverbial snowball rolling down a mountain. Since it's not indexed for inflation, and since deductions have risen over time, the number of taxpayers who will be paying it will rise exponentially in the coming years. The numbers are staggering: 856,000 AMT victims in 1998, an estimated 9 million by 2007, and…