A two-phase proposal to modernize how America raises revenue and funds earned benefits.
The U.S. tax system is overly complex, opaque, and increasingly optimized for strategies that concentrate wealth rather than broadly reward work, saving, and productive investment.
This project proposes a cleaner, more durable alternative designed to be legible to citizens and usable by policymakers.
These documents use the Amazon-style “Working Backwards” PR-FAQ format. It is a concise way to present ideas, assumptions, and tradeoffs.
A structural redesign of the income and capital gains tax system that:
→ Read Phase 1: Income & Capital Gains Reform
A modernization of Social Security financing that:
→ Read Phase 2: Social Security Modernization
The U.S. tax system isn’t just complicated. It is structurally misaligned with the economy and society it is meant to serve.
Over time, three deep problems have emerged.
First, the system has become too complex to understand, explain, or govern.
What began as a set of pragmatic rules has grown into a dense web of deductions, credits, exceptions, and phase-outs. Complexity shifts power toward specialists, raises compliance costs, and makes honest public debate about tradeoffs nearly impossible. When a tax system requires professional mediation to navigate, it stops being democratically legible.
Second, the system no longer treats income and wealth accumulation coherently.
Labor income is taxed early and often, while large asset gains can compound for decades with little or no taxation. Similar economic outcomes are treated very differently depending on form, timing, and sophistication. This asymmetry rewards financial engineering over productive activity and contributes to persistent wealth concentration that undermines economic mobility and opportunity. The structure no longer aligns incentives with broadly shared growth.
Third, the current structure makes long-term fiscal balance harder, not easier.
An aging population, rising interest costs, and persistent deficits leave little room for error. Yet the tax code relies on narrow bases, temporary provisions, and optimistic assumptions. Complex, brittle, and fiscally unbalanced systems fail through gradual loss of credibility, followed by crisis-driven fixes that are harder and more divisive than thoughtful reform.
These conclusions inform three core design tenets that guide both phases of the proposal:
This proposal focuses on structural reform within the existing income, capital gains, and Social Security frameworks, not a VAT or wealth tax. Each tenet is defined in detail and applied consistently across Phase 1 and Phase 2.
The goal is not to win a partisan argument or optimize for a single constituency. It is to refactor a system that has accumulated too much accidental complexity and too many hidden tradeoffs.
A tax system that people cannot understand cannot sustain trust.
A system that cannot balance over time cannot sustain a republic.
This is an attempt to fix both.
These proposals are by Matt Sly. I am not a career policy professional. I’m a quasi-retired software entrepreneur. I’ve paid taxes in many roles—student, teacher, employee, founder, executive, investor, parent—and seen the system from multiple angles.
I’m a systems thinker and product builder by background, and I approach the tax code the same way I would a complex software system that has accumulated too much accidental complexity over decades without a clear owner and is not serving its customers well. My goal is to help “refactor” the tax code by simplifying where possible, reducing the hidden costs of complexity and edge cases, and making fiscal tradeoffs legible to both policymakers and the public.
This project is not affiliated with a political party, campaign, or institution. It is an attempt to apply systems thinking, real-world experience, and clear tradeoffs to a problem that sits at the intersection of economics, equity, and long-term national health.