Letters to the Editor

Implicit, high and defective taxes

Published: April 25, 2005

Alan Reynolds mischaracterized my views on the alternative minimum tax (AMT) and, worse, promulgated one of the most common misconceptions about the tax -- that it applies low rates to a broad base ("Tax simplification simplified," Commentary, April 17).

In fact, the phaseout of the AMT exemption creates implicit taxes at rates up to 35 percent. Most taxpayers face higher effective marginal rates under the AMT than under the regular income tax -- one of the AMT's many flaws. Besides the pointless complexity, other defects include steep marriage penalties and inflation-induced bracket creep that builds in automatic tax increases every year.

LEN BURMAN

Co-director, Tax Policy Center

Senior fellow, The Urban Institute

Washington