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.