One of the big surprises contained in the research released last month by the Microbusiness Research Institute (MRI) was the microbusiness take on taxes. For years, small business lobbying organizations stoutly asserted that the nation’s small business owners wanted lower tax rates. They do, too, but the MRI research found that more of them want simpler taxes and still more of them want fairer taxes. That being the case, microbusiness owners are likely to cheer the efforts of Senators Ron Wyden (D-OR) and Judd Gregg (R-NH) to enact tax reform this year. Their aim is exactly that — fairer and simpler taxes — and they might pull it off, if they can get the attention of their fellow Senators this session. Will their proposal work for microbusinesses as billed? As is usually the case with these big ticket reform items, the devil is in the details.

The Bipartisan Tax Fairness and Simplification Act of 2010 (S. 3018) reduces the number of both individual and corporate tax brackets and reduces everybody’s tax rates. It gets rid of the alternative minimum tax and almost triples the standard deduction so that people don’t have to itemize. Wyden and Gregg also eliminate preferential tax treatment for specific business types, industries and activities, and reduce the number of exclusions, exemptions, deductions, and credits. Of course, to say that the proposal “targets corporate welfare” doesn’t tell you much. If the legislation instructs the Congressional Budget Office to use the Cato Institute’s recommendations we’re in trouble, because the Cato Institute thinks the SBA is “corporate welfare.” Still, this bill is a good, bipartisan place to start a much-needed discussion about tax reform, although it’s doubtful that the Senate Finance Committee will get to it during the current session of Congress.