WHO BENEFITS FROM THE COMPLEXITIES OF THE INCOME TAX?
In order to maintain a safe and civilized society, it’s important that people respect and obey the rules and laws that define what is acceptable behavior and what is not. For example, traffic laws and traffic signals exist to ensure that everyone can drive safely from one part of town to another. People who disobey those laws endanger themselves and everyone around them.
We also understand that in order for a government to provide services to its citizens, it must collect taxes from those citizens in order to pay for the things the citizens demand from their government.
Of course, no one really enjoys paying taxes. We’d rather spend our money on ourselves, and every dollar we pay in taxes is a dollar we can’t use for our own consumption.
Senator Russell B. Long served seven years as chairman of the Senate Finance Committee, which handles tax legislation. Senator Long said,
“Most people have the same philosophy about taxes,”:
Don’t tax you,
Don’t tax me,
Tax that fellow behind the tree.
From the time the first government levied the first tax right up to the present day, governments have struggled to find ways to extract the taxes they need in a way that the citizens will at least find acceptable.
WHY DO WE HAVE SUCH A COMPLEX INCOME TAX SYSTEM?
The Merriam Webster dictionary defines simple as: not hard to understand or do.
It defines complicated as: difficult to analyze, understand, or explain.
The FAIRtax is an example of a “simple” tax system. It has the following characteristics:
- Easy to calculate and collect
- No personal tax returns
- Not possible to hide the tax
- Difficult to evade
- Applied uniformly
- Has a prebate to ensure fairness
- Has no special benefits for the wealthy or special interests
- Least harmful to both individual taxpayers and the economy in general
- Helps protect domestic jobs from being eliminated by foreign imports
- No IRS
- Shows the true cost of government
The federal income tax is an example of a “complex” tax system. It has the following characteristics:
- Difficult to calculate and collect
- Requires personal and corporate tax returns
- Easy to hide. The cost of income tax is included in the prices of all the goods and services we buy
- Relatively easy to evade
- Not applied uniformly
- Contains special benefits for the wealthy and special interests
- Costly and inefficient to administer
- Costly and inefficient to comply with
- Favors imports over domestically produced goods leading to fewer American jobs
- Requires a bigger, more cumbersome and more abusive IRS
- Hides the true cost of the government
The Roman orator and statesman Marcus Tullius Cicero used the expression cui bono in several of his attacks on corrupt Roman officials. Cui bono means “Who benefits?”
Obviously, almost all of us will benefit from the simple system. So, the question becomes who benefits from the complex system? The people who benefit from the complex system generally fall into one of three categories.
First, there are those who have been able to purchase or otherwise obtain special treatment that enables them to pay far less income tax than they would otherwise pay.
Next are those who actually profit from having a complex system. This group includes people like lobbyists, tax preparers and other tax professionals. For them, the more complicated the system is, the better. Complicated rule make it easier to hide special benefits for the lobbyist’s clients. The harder the tax system is to understand, the more money these people can charge for their services.
And finally, there are people in government who arrogantly believe that they are smarter than the rest of us. They believe that the rest of us must be brought under their control “for our own good”. They see a complex income tax system as a way to ensure that everyone acts in the ways that they have decided are “good for us”. If we do what they want we get rewarded and if we don’t we get punished by paying higher income taxes.
Those in the first two groups are motivated largely by greed. At some level, they may understand that they are profiting at other people’s expense, but most find a way to justify it.
It’s those in the third group who are the most ardently opposed to replacing the complex system with the simple one. And unfortunately, these are the people who by and large get to decide what our tax code looks like. If the FAIRtax is ever going to replace the income tax, we the people are going to have to rise up and demand it.
CONCLUSION
During the course of a meal with the accountant who prepared his income tax returns, Albert Einstein said, “The hardest thing in the world to understand is income taxes.” The accountant replied: “There is one thing more difficult, and that is your theory of relativity.” “Oh, no,” Einstein replied,” that is easy.”
So, the next time you find yourself wondering why our government stubbornly clings to an incredibly complex and incomprehensible tax system when there’s a much simpler, fairer and better way to do it, ask Cui Bono—who benefits?
It is important that people who support the FAIRtax understand the reasons that certain groups of people oppose it. And it’s also important to know that the people who make up those three groups above comprise a VERY SMALL minority of the country’s population—maybe 1% at the most.
Since we still have elections, we still get to decide who represents us in government. We have the power to send representatives to Congress who will act in our best interests and replace the income tax with the FAIRtax. The only thing supporters of the income tax can do is try to divide us so that we are not voting for a sane system.
We just need to keep pointing out the insanity of the complex income tax and the benefits of the FAIRtax to everyone. Once our friends and neighbors are properly informed about the FAIRtax, it should be easy to get them to vote with us in favor of a sane tax system.
What else can each of us do?
We can write letters and make calls to our elected representatives demanding that if the government really wants to eliminate the burden of filing income tax returns, they should enact the FAIRtax and do away with tax returns altogether.
The great 18th century Irish statesman Edmund Burke made a statement that applies in many ways,
“Nobody made a greater mistake than he who did nothing because he could do only a little.”
If you want to prevent the IRS from being further weaponized to punish those of us who may object to the D.C. opinions and dictates of what is good for us, then help us PASS THE FAIRTAX!
The IRS will be gone and we will pay our taxes when we make purchases. WE and not D.C. Elites will decide how much federal tax we pay!
If you have friends who don’t know about the FAIRtax, send them to FAIRtax.org. Have them watch the white boards under “How It Works” and, if they agree, ask them to please join us.
Then contact your Members of Congress and the President and demand that Congress pass -the FAIRtax—the only fair tax.
Remember, if we don't continue to tell the truth and demand a change, then this quote from George Orwell's 1984 may foretell our children's future:
“If you want a picture of the future, imagine a boot stamping on a human face—forever.”
Is it hopeless? When confronted with a seemingly impossible problem, remember the statement attributed to the author George Bernard Shaw who wrote, You see things; and you say “Why?” But I dream things that never were; and I say “Why not?”
Isn’t it time for us to ask, “Why not?”
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