Taxation with Manipulation

Taxation with Manipulation

http://americanfederalist.blogspot.com/


Why is the United States tax code so complicated? One might think that our elected representatives could manage the chore of taxing people with a few relatively simple and easily understood words. Instead Americans are subject to thousands of pages of ever changing regulations. What possible use are all those regulations?

There have been several calls in the recent past for simplification of the tax system in America. They seem to have boiled down to two options: the fair tax and the flat tax. The fair tax (HR 25,/S 296) is a sales tax. It is paid once, at the point of purchase. The flat tax is a system whereby everyone is taxed the same percentage of their income. The rich would pay more because they make more. Both plans contain provisions by which those below the poverty level would receive a refund. There are a number of concerns with both of these plans, mostly regarding changes to the status quo and how those changes will affect the nation.

Will America see either one of these proposals come to a vote, much less enactment? It’s doubtful for a number of reasons. One of those reasons is that the tax code is being used to influence the behavior of American citizens. The tax code is used as both the carrot and the stick. It rewards “good” behavior and it is used to punish “bad” behavior. The definition of “good” and “bad” is often dependent upon whomever is in power at the time. How much would a beer or a pack of cigarettes cost you without the “sin tax”? Would you really donate as much to that charity if it wasn’t the end of a year in which you needed another tax write-off? How about installing those new, energy efficient windows-they ones approved for the tax break?

Another reason the tax system hasn’t been simplified is because the current tax system isn’t just being used as a way to collect revenue for the government and influence behavior. It is a sword of Damocles hanging over the head of every American citizen. It is one of the largest and most effective law enforcement tools the government has. How can individual Americans scrutinize the thousands of pages of tax code that are changed and amended every single year to be sure they have done everything as they should? What American does not feel the least bit of trepidation when the time comes to sign their tax returns certifying that “to the best of my knowledge and belief, they are true, correct, and complete”?

Is this really an appropriate use of the tax system? Do the words ”to promote the general welfare” grant authority to the government for this kind of social engineering, experimentation and tyrannical oversight of our personal finances? Common sense and the most cursory of readings of our founder’s writings indicate otherwise. And yet, should any of the current healthcare proposals be passed, Americans will all be making healthcare choices determined by the fact that we will all be subject to being “taxed” for not obtaining “government approved healthcare.” We may even go to jail for non-compliance. Not to promote the general welfare, but to implement the policies of a president and administration who believe that the fruits of our labor should be “redistributed” according to their values, not ours.

Belanne Pibal is a Liberty Features Syndicated writer.

One thought on “Taxation with Manipulation

  1. The current Income Tax is a psychotic legal system.

    Inhabitants and businesses of this country spend billions of dollars a year and then spend billions of hours in attempted tax compliance. This just to figure out what they owe or don’t owe in Income taxes.

    The Income Tax code itself is made up of 9,834 sections comprising more than 16,845 pages of arbitrary and contradictory laws and opinions.

    This plus an additional two-and-a-half million more pages of Income Tax Regulations, Income Tax Revenue Rulings, Income Tax Letter Rulings, Income Tax Memorandums, Income Tax Publications, plus Tax Court, Appeals Court and Supreme Court Opinions. These are all written in an effort to explain and/or argue about the mind-numbing Income Tax laws.

    Most personal, financial and business decisions all have to take into account this Income Tax system and generally require expensive assistance from tax accountants and lawyers who all have different opinions on how to apply the Income Tax legal code.

    They themselves do not understand many facets of the Income Tax code, the same way most government officials do not understand it (try calling them up and getting a consistent answer to the exact same tax question – good luck on that).

    If you are ever the victim of an Income Tax Audit based on the income and deductions you reported on your personal and/or business Income tax return, it could easily cost you thousands upon thousands of dollars to defend yourself if you hire a tax lawyer or tax accountant to defend you.

    The Income Tax laws are written so that you are automatically guilty and you must prove your innocence. Thus you have to ‘prove your innocence’ against an Income Tax system that is arbitrary, mind numbing and contradicts itself within its own code.

    Every single inhabitant of the country is required by law to keep an accounting of their yearly income and deductions (for the Income Tax) and is required by law to maintain ongoing lifetime balance sheet and net worth calculations (for Estate and Gift taxes)

    This accounting is subject to government scrutiny and must be proveable.

    So the bureaucracy of this Income Tax system is embedded in every single facet of your life, from the government to the courts to tax lawyers to tax accountants to financial advisers to income tax software companies.

    Unless something is done to get rid of this “system” (like instituting the Fair Tax or the Flat Tax), the current Income Tax scheme is going to continue to wreak financial havoc on the United States economy and its inhabitants.

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