December 9, 2004 | Read Time: 1 minute
By Grant Williams
Charity officials are watching closely to see whom President Bush names to a committee that he plans to form to advise the Treasury Secretary on how to overhaul and simplify the federal tax code. The appointments could offer a clue to the changes Mr. Bush may eventually seek from Congress.
During the presidential campaign, Mr. Bush called for fundamental changes to the tax code. While the White House said that any changes would need to recognize theimportance of charity in American society, nonprofit leaders fear that a tax-code overhaul could affect or eliminate deductionsfor contributions and dampen charitablegiving.
The Bush administration apparently favors retaining the current income-tax system while seeking to reduce tax rates and cut taxes on investments. In recent months, Mr. Bush has said that his options might include a flat tax in place of the current income tax, or a national sales tax. Reduced income-tax rates would mean that tax deductions for charitable gifts would be less valuable. But some argue that people would increase their donations to charity if they paid less in taxes.
