Thursday, January 08, 2009

Cost of Taxes

This is not exactly "new" news, but we'll post it anyway.

The No. 1 problem facing U.S. taxpayers? A tax code so complex that Americans spend $193 billion per year just trying to figure out how much they owe, said Nina Olson, the National Taxpayer Advocate, in her annual report to Congress on Wednesday.

That amounts to 14% of all income taxes collected, according to Ms. Olson. Tax-code changes have averaged one per day over the past eight years -- with 500 changes in 2008 alone, she said.

She suggested simply dumping the AMT.

(Wanna bet on that?)

The CPA/Tax Lawyer lobbyists have defeated all "simplification" moves to date, rather handily. You can expect they will continue their success record, although there is always that 1% "Black Swan" factor.

5 comments:

Scott said...

The problem with simplification is that every time you guys talk about it what you really mean is that you want to flatten it, make it less progressive. Simplify it in a way that doesn't do that and I'm all over it.

Besides, most of those "complications" in the tax law don't affect you and me. They're there for the benefit of businesses. Sometimes even specific industries. It has nothing to do with making your 1040 EZ more difficult.

Dad29 said...

Maybe YOU fill out a 1040EZ. I haven't for at least 30 years.

I've repeatedly endorsed the "Fair Tax," (essentially a sales tax with an exemption structure for personal/children and state/local taxes.)

Steve Forbes doesn't like that idea for the obvious reason: ostentatious consumption will really be hit, hard.

That's why he likes the "flat" tax, which hits all income-earners exactly alike, at around 15%.

Anonymous said...

Fair Tax all the way baby!

JJ

Scott said...

Just guarantee me that the plan falls changes the tax burden distribution in the following parameters: anywhere from zero change in the distribution of the burden to a 5% lessening of it for the lower half of earners. That is, promise me it'll be from 0-5% more progressive than the current tax burden, and I'd consider it.

Dad29 said...

Given that reform will NEVER happen, I can promise you anything, Scott!

However, the Fair Tax people (see their website/Google..) are convinced that this will be very friendly to lower-income people and hit the blazes out of the Big Spenders.