Mortgage is one of the most popular deductions. It costs the Treasury about $103 billion a year. Now that's money we could use to treat wounded veterans or reduce the deficit or fill the border. Instead, we give it a subsidy to homeowners, and it goes mainly to the richest homeowners in America, because only one third of Americans itemize their deductions. It doesn't work. Many countries have gotten rid of the mortgage interest deduction. Almost all of them have higher homeownership rates than we do.

We cut tax exemptions in 1986, it was the most admired tax reform in U.S. history. Congress and the president worked together then to eliminate scores of loopholes and exemptions and deductions; this made taxes much simpler, and allowed a major cut in tax rates.

The Value-Added Tax, a sales tax that applies at every level of business transactions, is an easy tax for governments to collect, and a hard tax to evade.

Professor Eric Zolt of UCLA, said to me, "The VAT is such a good idea, mark my words, within five years, the U.S. will have a VAT." Then he said, "Of course, I've been saying that for 20 years."

Corporations use all sorts of complex stratagems to move their profits overseas, and thus escape the U.S. income tax.

President Trump repeatedly says that "America is the highest-taxed country in the world." This is an alternative fact. We pay less in taxes, and our government spends less, as a share of our total wealth, than our counterparts in Western Europe and East Asia. But Trump is right when it comes to corporate tax rates; the U.S. corporate income tax right is among the highest in the world.

The Value-Added Tax, a sales tax that applies at every level of business transactions, is an easy tax for governments to collect, and a hard tax to evade. So it makes the job of raising revenue easier. The revenues from the VAT can then be used to lower taxes on income and saving and investment. The Value-Added tax doesn't penalize work or saving; it's a tax on buying stuff.