Treadwell says he wants to replace IRS with "fair tax"

Nathaniel Herz

Republican U.S. Senate candidate Mead Treadwell, at a debate Tuesday in Homer, called for a new tax system that would replace the Internal Revenue Service.

In a phone interview later, Treadwell, who is running in the Aug. 19 GOP primary against Dan Sullivan and Joe Miller, called the IRS a “fraudulent agency” and said that the American tax system contains a “huge number” of loopholes and disincentives.

Treadwell said he would prefer to see a “fair tax,” based on “value as added to services or goods in the economy.”

“It moves the tax away from income to a tax on consumption,” he said. “It’s a much broader-based tax, and it’s fairer.”

Treadwell said he’d called for the abolishment of the IRS at the debate in Homer and added that he had also done so at an earlier debate.

He declined to give an estimate of the rate at which a new tax would be set under his proposal. But a national FairTax campaign seeks to establish a retail sales tax of 23 percent on new goods and services. (When calculated at the counter, the effective rate would be 30 percent.)

Miller has also called for the abolition of the IRS and for the country to institute a “fair tax.”

Nationally, a fair tax or flat tax has become a favored proposal of conservative candidates in recent years.

Herman Cain, the 2012 Republican presidential candidate, famously pushed for a flat tax he called 9-9-9: 9 percent on individual income, a 9 percent corporate tax rate, and a 9 percent national sales tax. And 2008 GOP presidential candidate Mike Huckabee pushed for the fair tax.

In the Senate, a fair tax bill currently has nine sponsors, all Republicans, and a House version has 76 GOP sponsors, though neither measure is likely to be enacted.

A spokesman for Sullivan, the third Republican primary candidate, said in an email message that Treadwell's ideas are “unrealistic.”

“It’s important we actually put forth viable solutions to reforming our tax code, rather than purporting to abolishing entire agencies for political purposes,” said the spokesman, Mike Anderson. “There is an immediate need to cut waste, fraud and abuse in our tax system. More importantly, and realistically, we need to simplify our tax code, close loopholes created by special interests, and reduce or eliminate the myriad of regulations that present such a daily burden to our economy.”

Treadwell said a fair tax represents the kind of principles he’d like to see in a new tax system, though he added, “How we get there, I don’t know.” He said he would like to see a repeal of the 16th Amendment, which authorizes the federal government to collect an income tax.

He said that the recent congressional investigation of the IRS had “exposed a corrupt, fraudulent and politically driven agenda.”

The agency is alleged to have given certain conservative groups extra scrutiny when they were seeking tax-exempt status, and emails belonging to a top IRS official have been lost, which officials are blaming on a hard drive crash.