Forbes touts flat tax at WSU speech

OGDEN -- One of America's best-known businessmen was in town Wednesday to express his support for a proposed flat-tax system in Utah and nationwide.

Steve Forbes, president and chief executive of Forbes Inc. and editor-in-chief of Forbes magazine, told a crowd of more than 100 at Weber State University that Gov. Jon Huntsman's proposal to implement a statewide flat-tax rate could serve as an example for others to follow.

"You have a great opportunity to help do something in this state that will have profound implications, not only for Utah, but also for America and the world," Forbes said. "Utah has a chance to make history."

A flat-tax system would do away with deductions for things like charitable donations and home mortgages, and in turn would fully exempt households from taxation up to a certain income level, based on the number of dependents.

Many nonprofit organizations and advocates of social programs have opposed such a system on the grounds that taking away deductions would remove incentives for people to give to charitable causes or buy homes.

Forbes said the sheer economic growth and job creation resulting from a reduced tax burden would mean more prosperity for everyone.

"When people have more, they do more and give more," he said, adding that a simplified tax code would make it more difficult for the wealthy to hide earnings and write off questionable expenses.

Forbes is calling for a 17 percent tax rate across the board for those who exceed established income levels. He said many other nations, and a handful of states, have already implemented similar systems with great success, and the U.S. needs to keep up in order to stay competitive in an increasingly global economy.

He decried the current U.S. Income Tax Code, a document that has grown to more than 9 million pages over the years.

His speech was punctuated with pointed humor, as when he referred to the estate tax, nicknamed the "death tax," as "taxation without respiration."

He praised Huntsman's recent proposal to let Utahns choose between paying a flat tax or sticking with the current system.

"Let people find out for themselves which is better," he said.

Forbes unsuccessfully ran for the U.S. presidency in 1996 and 2000 on the platform of a nationwide flat-tax system.

Born Malcolm Stevenson Forbes Jr. in 1947 to wealthy publisher Malcolm Forbes, Steve Forbes began working for his father's company at age 16. He became president and CEO of Forbes Inc. in 1980, and took over the reins at the company's flagship magazine following his father's death in 1990.

Forbes magazine currently ranks Utah the fourth best state for business, behind Virginia, North Carolina and Texas.

"Utah is on the cusp of an extraordinary economic era," Forbes said. "People are interested in quality of life like never before, and technology has removed the constraints of geography."