By the end of 2009, Congress will have spent nearly $700 billion on the Iraq war, and another $225 billion or so on the fighting in Afghanistan. As a nation, we've met these costs using the same fiscal tools that we use to pay for everything else: a broad, eclectic, and undifferentiated mix of taxes and debt. What we haven't used is any sort of special war tax (like the 10 percent income tax surcharge enacted during the Vietnam War). Nor have we asked Americans for a general tax increase (as in World War II), with the war serving as an explicit justification for the hike.
We need a small but meaningful war tax. We should have had it long ago, but I'd rather have it late than never. In theory, both hawks and doves should support a war tax. After all, if these wars are worth fighting, then they are worth paying for. And if they're not worth fighting, then it's important to point out how much money we're wasting.
View TaxAnalysts' Joe Thorndike's opinion in its entirety on TAX.com.