If you'd like to minimize the impact of bad parts of the income tax code like the home mortgage interest deduction, this would be a way to do it. Just shift the taxation over to a place where the deductions don't exist. There are good deductions, like the charity one, but maybe it's worthwhile overall to just make the deductions irrelevant. At the same time, you'd be making tax preparation more efficient by doing it all in one place where professionals and computers could take care of it, instead of forcing every American to spend hours trying to be an amateur accountant in the first few months of the year.
Fine for wage and salary income, but that's not all of the personal income that shows up on personal income tax returns ~ you seem to be proposing a 0% tax rate on capital gains, interest and other wealth income.
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