If we can’t start with a blank white sheet, let’s start with the 400 page code of 1913 and CHANGE the words, instead of endlessly adding to them.
According to the Washington Times, the US Tax Code is seven times the length of “War and Peace” and contains 4 million words.
According to CCH, the US Tax Code has increased from 400 pages in 1913 to over 72,000 pages by 2011. I wonder how many pages of tax rulings, case law, precedents, contradictory and otherwise there may be. Whereas these numbers are taken from the USA, the same is happening throughout the world.
It’s no wonder then that there are millions of wasted brains devoted to deciphering what all this means. Imagine how much more constructive matters all those smart people might attend to if their days weren’t consumed with the endless analysis of the minutia of the tax system. All those tax lawyers, accountants, tax preparers, and government tax officials, what did they dream of when they were little?
The Right of Government to Tax and the Obligation to Pay
Lawyers for Wesley Snipes using the tax protester “861 argument” argued that the government doesn’t even have the right to tax.
Who gave government the authority to appropriate the fruits of our own labour? And, there is not even meaningful accountability for prudently putting it to use. This is the extreme view but they do raise some questions.
Argument 861 aside, there is a need for individuals to pitch in for required common services that free markets might not otherwise provide. Where the line is drawn about how many services should be provided is the stuff of commonplace political discourse. Regardless of where the line is drawn, surely Governments should not have the authority to endlessly burden citizens with taxes, new taxes, ludicrous amounts of work to comply, account and file all of these at a totally unreasonable cost.
Government Accountability has become Theoretical
The accountability of voting out the politicians who abuse their authority in this regard has become purely theoretical. Each political group has demonstrated that they are equally culpable through their inaction on tax reform, along with their contribution to the problem in the form of additional tax legislation, loopholes and cash grabs. Perilously, elections have become about who gets the reigns of the purse rather than the prudent management of it.
We’ve Crossed an Ethical Line and we Must Return to the Side of Right
Now governments have reached the point where they’ve racked up incredible financial obligations. Debt levels are almost incomprehensible. Worse, monies have been squandered, not invested in endeavours and assets that will yield for generations to come. This is entirely unethical, and Wesley Snipes, et al, have a hugely bolstered position at this point. Who gave governments the authority to encumber unborn generations in exchange for nothing other than yesterday’s abuse?
Legislators Created this Muddle, Taxpayers are Simply Working Within It
Legislators are the authors of their own (and by extension, our own) demise having made this stuff so complex that taxpayers are contorting their structures to optimize their tax position. Each line of tax code has been added for a purpose, to incentivize an industry, to give a break to someone or some group. All this creates “loopholes” as laws are overridden or tweaked. It’s the legal obligation of taxpayers to comply with all this. It’s also completely reasonable for them to act in their own best interest. If there’s an incentive that suggests if you modify where or how you invest, perhaps you’ll do just that and reduce your tax. After all, in many cases that was the intention of the legislation to begin with. So, to call into question the integrity of taxpayers who optimize their tax situation as some in government are screaming out today in their insatiable reach for more cash, is disingenuous at best.
The so called tax inversion we are seeing in which a company switches its domicile through a merger or acquisition is only one of many manifestations of the bed the legislators have made.
Simplicity and Transparency Expose the Wrong Doers
To be sure, not all motives are pure. Corporations, individuals, legislators and politicians don’t always have the “greater good” top of mind. The complexity of the tax system provides thousands of nooks for the ill-motivated to hide. A simplified tax system would provide clarity and transparency. The nooks and other hiding places disappear along with the fancy words and the million dollar arguments.
The Time is Now for Ground up Tax Reform
The time is now for ground up tax reform. This is not a partisan issue. If we can’t start with a blank white sheet, let’s start with the 400 page code of 1913.