Sunday, April 15, 2007

Republicans Wish You A Painful Tax Day

So here's a pretty nice policy idea from John Edwards: if the IRS already has all the information it needs to do your taxes, as it does for about 50 million Americans, why don't we spare you the trouble and have the IRS do your taxes by itself? The IRS would then just send you "Form 1" in the mail, telling you how much you owe or how big your refund is, and you'd sign it and return it. Studies suggest that this would save Americans approximately 225 million hours of tax-related drudgery.

The folks at the National Review have objections, though. I particularly liked this from Steve:

I think one of the best things conservatives could do to make people realize just how bad our tax burden is would be to require all taxpayers to file and pay taxes quarterly. The current insidious system of employer withholding was designed to collect income taxes without taxpayers feeling the pain of writing a check.

Apparently he wants to build up government bureaucracy... so that people will get mad and want to tear down government bureaucracy. Republican governance at its best!

Now, I think the Republicans are right about the political situation here. If you make paying taxes painless, the most intense negative emotional experience associated with the tax system will go away. Not that everyone will suddenly be going "Hooray for taxes!" but the situation that instills the most passionate hatred of taxes will be gone, and resistance to taxation won't be as strong. Those of us who want to provide the revenues for national health care, free preschool, or any number of other useful benefit programs should be especially happy about progressive tax simplification proposals of this kind.

There are a couple other side benefits to the Edwards tax simplification proposal. It'd help poor people get deductions and credits that they might not know they're entitled to, like the EITC. Less than half of the eligible families with incomes below half of the poverty line know that they're eligible, and Hispanics are especially likely to be unaware.

Also, some poor people don't know about refunds, and the "Form 1" proposal would be especially beneficial for them. A friend of my brother was in a poor black North Carolina neighborhood some years ago, educating people about their taxes as part of a volunteer program. He met a woman who had been avoiding her taxes because she simply didn't have any money to pay. When he explained to her that doing her taxes meant getting a large refund check from the government, she didn't stop hugging him for a while.

1 comment:

J Crowley said...

Of course you realize, no neoconservative has ever truly been for "smaller government"; truly examining their motives and actions, you'll notice they are in reality for "bloating, contriving and obfuscating government to the point where it can barely roll off the couch, then dragging everyone over to peer through the sheet-plastic windows of its double-wide to poke fun at how pathetic it is and get everyone to throw rocks".

It's part of why they refuse to make any sensible smaller adjustments to tax laws, (like, for instance, adjusting the alternative minimum tax to correspond with inflation, or accepting the inheritance tax change that would've raised the cap to several million dollars, thereby guaranteeing it wouldn't affect lower- and middle-income estates). They want to make taxes as painful as possible for everyone, just so that they can push through their own tax agendas that exclusively benefit the wealthiest at the expense of the poor and the public as a whole.

Yet, astonishingly, many American voters still believe their demonstrably untrue lines about "making government smaller".