With prospects for bipartisanship looking increasingly thin in the present political era, a surprising exception has arrived on the scene, bearing the best of fiscal reforms culled from both parties – and perhaps most significantly, the bill features a radical departure from previous action on the Alternative Minimum Tax (AMT).

I refer to the Wyden-Gregg Tax Reform Act, proposed by Sens. Judd Gregg (R-NH) and Ron Wyden (D-OR). On its basic merits, this bill has much to recommend it as a piece of bipartisan national legislation, but perhaps the most encouraging portion of the bill will be its bold approach to the AMT. Unlike previous outings, which sought to “reform” or “reduce” this particular policy, the Wyden-Gregg bill goes where no bipartisan bill has dared to go before, and argues for flat out abolition of the tax.

Curtis Dubay, Senior Tax Analyst for the Heritage Foundation, has the details:

     Wyden-Gregg makes important strides toward reducing complexity. First, it reduces the number of tax brackets and rates for individuals from six to three. It also makes the corporate income tax a 24 percent flat tax. Second, it drastically reduces the number of credits, deductions, and exemptions for families and businesses. Lastly, it completely abolishes the AMT. In addition to reducing complexity, the abolition of the AMT will also remove the threat that the AMT will raise taxes on middle-income families. The AMT is intended to affect only high earners, but the minimum income that designates families for the AMT is not indexed for inflation. So unless Congress passes a patch to increase that minimum threshold each year, the AMT would hit a growing number of middle-income families. Full repeal of the AMT will also stop Congress from raising other taxes to ‘pay’ for the AMT patch each year.

Taken together, these impacts present a potentially pleasing picture for Californians especially, for whom the inflation-averse tax is likely to sting with particular vigour. Yet, what is perhaps even more extraordinary is how much the bill’s bipartisanship comes without any expense to its philosophical consistency. In an op-ed for the Wall Street Journal, Sens. Wyden and Gregg laid out the following effects the bill will also carry:

     We take a hard line on corporate welfare by directing the Congressional Budget Office to examine the roughly $90 billion that the federal government spends to subsidize businesses directly and indirectly each year. These steps not only make the tax code simpler and fairer for everyone, they reduce opportunities for individuals and businesses to cheat the system and avoid paying their fair share.

To be sure, whatever the tacit class-preferential rhetoric employed in this description, its root effects curb abuses which both sides of the aisle have historically disdained – namely, excessive corporate subsidies. Quite unlike tax increases, reducing subsidies has the potential to indirectly increase the money in the pockets of all Americans, given that it removes one more onerous burden on the government’s balance sheet.

There is one element of the bill which is sure to raise eyebrows, however, and that is the attempt to close tax loopholes giving companies an incentive to export jobs overseas. This measure, which may smack a bit ominously of protectionism for some commentators, is likely a concession thrown in to placate the pro-domestic manufacturing lobbies for whom Congress is a natural habitat, but is not nearly dangerous enough to kill an otherwise sound bill.

Thus, independent voters everywhere need not despair completely of the prospect of governance – the bipartisan instincts of our elected representatives are quite capable of showing themselves to be alive and well.