May 15, 2013 12 Comments
So we are all shocked that the IRS targeted conservative/Tea Party groups to slow down their tax exempt status, huh? Why on earth would you be surprised? FDR did it, Kennedy did it, Johnson and Nixon did it, probably the rest did as well. The only difference is that they perhaps were a bit more discreet.
You cannot have a tax system that runs 70, 000 + pages without playing favorites. That’s why you have a tax code of 70,000+ pages. First Congress sells special breaks and then the executive sells special breaks for whatever reason.
Oh, you thought the IRS was this objective group in an ivory tower that read objective books and never showed favoritism? Good luck with that. OK, I will say that they have been very obvious the last few years, like nobody could challenge them any more. Seems to be a lot of hubris going around in the Obama administration, I don’t really understand why, but there is. I guess they think they are going to be able to rewrite history.
Note that it could not really be anything other than corrupt by the way, if you’re trying to enforce that mass of regulations you, are going to default to the solutions you know, even if there are other options. It’s not really corruption, a lot of times, in my mind, as much as it’s laziness, and we are all subject to that.
But you know, Congress could solve this tomorrow, if they had the will. It’s called the flat tax. And in its simplest implementation, you replace all 70,000+ pages with one that says. “All income earned in any manner by any natural person in the United States, and it’s possessions shall be taxed at the rate of 10%”.
That’s it. Make a buck-send them a dime; make a million dollars- send them $100,000. And you know what? You’d have very few compliance problems because everybody can understand it, and therefore there are no excuses.
You did catch the rest, right, no deductions for anything, none, nada, zilch. Nothing is exempt, and nothing except natural persons pay taxes. And therein is the downside, and why it’s so hard to get Washington to listen. How many people, inside the beltway, make their living directly or indirectly off the income tax code? I’d bet on more than half a million, many of them lawyers, and many of them politically connected. They’d have to find honest work. But it’s the only fair system, particularly since absolutely everyone in the country has skin in the game, not at a rate that hurts them but enough to notice.
And to make sure they do, repeal withholding, and the employer contribution, make them write the check, then they’ll notice what the government boondoggles are costing them.
And as a by-product-I’ll guarantee that the economic activity will pick up as fewer people are worrying about the tax code, and more are trying to make a living.
And just to make you rest easy, you realize that Obamacare is approximately the same size as the tax code now (and still growing), and will be administered by those same fine folks at the IRS.
What could possibly go wrong?
- Jared Bernstein: Why Should Any of These Groups Have Tax-Exempt Status? (huffingtonpost.com)
- Culture of Corruption: IRS officials in DC were involved in IRS targeting (riehlworldview.com)
- IRS Scandal: What Does the US Congress Expect? (thedailybell.com)