Proposals for tax reform are sweeping the country. Top down and bottom up, tax reform is one of the few issues that could win bipartisan support in the current U.S. Congress.

President Barack Obama got on board in his State of the Union address. Lower income tax rates? As one pundit said, “This is amazing for a Democratic president.”

What can be so important about tax reform that it may be the only issue on which the two parties can agree?

In particular, what is so special about pro-growth reform, lowering income tax rates and shifting the tax burden into previously untaxed?

A growing list of nations and states are pursuing reform by cutting spending and trying to grow their way out of their deficit dilemmas — cut government spending to reduce the draw of resources out of the private sector and restructure the way you tax in order to incentivize the growth of existing business and attraction or creation of new businesses.

We are in this fix because of our deficits. Special-interest groups have captured both political parties; the system in Washington rewards those who trade in “special interests.”

No one is watching out for the most special interest group of all — the American taxpayer. Politicians bring home the bacon while the deficit soars.

As long as this parochial behavior is rewarded, Washington won’t find the political will to implement transformational solutions to our big problems. Special-interest groups will stop any serious reform that requires trade-offs and real change.

Last November, the White House’s deficit reduction commission floated the idea of tax reform as the second key element of deficit reduction. First, cut government spending. Second, cut tax rates. They called for tax reform that “dramatically reduces rates, simplifies the code, broadens the base, and reduces the deficit.”

Done correctly, tax reform reduces the number of government services that must be cut. Reduced spending and tax reform reinforce each other.

The commission recommended big cuts in income taxes, reducing income rates by 12 percent for families and businesses filing at the individual rate and 9 percent for corporations. (“Pass-through” businesses are taxed at the individual rate rather than corporate and create about 70 percent of all new jobs.)

It also recommended “flatter” rates, moving from six to three brackets.

That’s the basic calculus of pro-growth tax reform: Eliminate exemptions and deductions and use that new revenue to cut income tax rates. That’s what worked in 1986. Lower rates spread over a broader base.

With Georgia’s proposal, all increases in tax revenue that come from expanding the base, taxing previously untaxed products and services – is plowed right back into lower income tax rates. It’s a trade-off. A taxpayer’s income tax rate is reduced by a third in exchange for changes such as an additional $6 a week tax on groceries for the average family.

Both Georgia and Washington are pursuing the same goal. Putting people back to work.

U.S. corporate income tax rates are highest in the world after decades of excess spending and raising taxes in attempts to reduce deficits by raising tax rates, especially on corporations. Germany (30 percent), Taiwan (17 percent) and South Korea (25 percent) have already led the way. When Japan cuts its rate this year, the U.S. moves to the number one spot (39.2 percent, combined state and federal.)

The same dynamic works between the states. The new governor of Florida, Rick Scott, promises to create 700,000 new jobs by promising to cut the corporate income tax cut to 3 percent from 5.5 percent. Florida’s personal and pass-through rate is already zero.

In our global, mobile economy companies can’t afford to stay in high-tax locations. To be competitive, producers must flee to lower-tax jurisdictions. Most large companies maintain flexible supply chains that shift production locations around the world in a heartbeat.

More and more countries have gotten the message. Japan has confronted this reality and will cut its current 40 percent corporate tax rate by 10 to 15 percent in stages starting this year.

How will prospective investors and domestic migrants view Georgia if our rates stay at 6 percent? Better if we move to the proposed 4 percent corporate and 4 percent personal and pass-through. Even better to go lower. In this environment, tax reform is important for all of us.

Do tax rates really make that much of a difference?

In the decade leading to 2007, the 10 states with the lowest corporate income tax rates (2.8 percent on average) saw state personal income grow by 82 percent. That’s against 58 percent for the 10 highest taxing states.

Voting with their feet, Americans looking for jobs and opportunity move to the low tax rate states.

In the first decade of the 21st century, the states with an average income tax rate of 7 percent lost population and 12 congressional seats. Six states (with an average income tax rate of 5 percent) gained one representative. Georgia (6 percent) is in that group along with Arizona and South Carolina (7 percent each). Florida and Texas gained two and four seats, respectively.

With evidence like that, why is tax reform so hard to sell to the voters?

With the national unemployment rate in the mid-9 percent and Georgia’s 34 percent teen unemployment — highest in the nation — why would we not want to do whatever we could to lower income tax rates?

With more states piling on the pro-growth tax reform train, how can we not?

Most tax experts recommend lowering income taxes and increasing revenue from sales and use taxes. You can do that by taxing income less and consumption more rather than raising the sales tax rate. (The Georgia Special Council on Tax Reform and Fairness chose to tax more items rather than raise the sales tax rate.) It’s regressive, but unemployment and cuts in government benefits are even more regressive. Other states and countries are lowering income tax rates in bids to increase their attractiveness to investors. States that stand still will fall behind.

Christine P. Ries is a professor of economics at Georgia Tech and a member of the Georgia Special Council on Tax Reform and Fairness.

Read it online at the AJC.