|..."taxes are frequently so much more burdensome to |
the people than they are beneficial to the sovereign."
71,684 pages of Tax Code.
3.7 Million words long. This source says,
"According to my office’s analysis of IRS data, U.S. taxpayers and businesses spend about 7.6 billion hours a year complying with the filing requirements of the Internal Revenue Code.
- If tax compliance were an industry, it would be one of the largest in the United States. To consume 7.6 billion hours, such a “tax compliance industry” would require the equivalent of 3.8 million full-time workers.
- Compliance costs are huge both in absolute terms and relative to the amount of tax revenue collected. Based on Bureau of Labor Statistics data on the hourly cost of an employee, my office estimates that the costs of complying with individual and corporate income tax requirements in 2006 amounted to $193 billion — or a staggering 14% of aggregate income tax receipts.
- More than 80% of individual taxpayers find the process of filing tax returns so overwhelming that they pay for help. About 60% of taxpayers pay preparers to do the job, and another 22% purchase tax software to help them perform the calculations themselves.
If you had to print the Tax code you would need a set of 71 books to simply print the code, and atleast 2 completely separate books as a table of Contents.
Our Crony tax system awards huge corporations like General Electric Corporation which earned $14 billion dollars, which had 5 billion dollars worth of profits to pay no taxes. From this interview, on the O'Reilly Factor Lou Dobbs says, "...And by the way, corporate America, Bill, buys, with $4 billion a year, representation that you and me and our fellow citizens can't buy in Washington. And the result is a tax system that permits GE to book its profits and leave them offshore and not, what's called repatriate, bring them back to the United States no matter where the profits are made. And that's what's happening here. They bought the loophole. They are using the loophole, and they're going to continue to do just that."
There is an old Wyoming riddle, "What do you call a horse built by committee?" Answer, A Horse.
The US Tax code was introduced in 1913, and was roughly around 400 pages long. In 98 years our elected officials have been busy modeling one moose after another, and we are left with 71,684 pages with 3.7 million words of loopholes and tax breaks in a mire of crony arrangements that I am certain would horrify the founders of this great nation.
This chart, shows the inequality of our current tax system, according to this chart "307,868,280 Americans compose 151,285,000 tax units, 49.% of which have ZERO federal tax liability in 2009. That leaves 80,438,545to pay over one trillion collected."
Currently two different popular models are being discussed as change to America's Tax Policy.
1. A Flat Tax This site from Freedomworks, touts tax reform under these "4 Basic Principals"
All Americans should be equal before the law—including the tax code. We are not. We need to Scrap the Code! And replace it with one that is simple, low, flat, fair, and honest.
- Supporters of fundamental tax reform have agreed on four basic principles:
- Lowering and flattening marginal rates
- Moving towards full expensing of business investment
- Reducing or eliminating the double taxation of dividends and capital gains International tax reform
The current tax code does more than complicate people’s lives during tax season and reduce living standards. It also pollutes Washington’s political culture. As special-interest provisions have been added to the tax code, Washington’s lobbying industry has flourished.
It reduces incomes through punitive taxes on saving, work, and entrepreneurship. It places multiple layers of taxation on saving, thus reducing investments in new machines and technology that make American workers more efficient and competitive. High marginal tax rates (that is, the tax rate on the last dollar earned) discourage work, saving, and entrepreneurial activity, which leads to a smaller and less productive economy. By favoring certain economic activities over others, the tax code distorts financial decisions and reduces economic efficiency."
2. The Fair Tax This site from FairTax.org wants to entirely abolish the Federal income tax system and move to a national sales tax. "The FairTax proposal is a comprehensive plan to replace federal income and payroll taxes, including personal, gift, estate, capital gains, alternative minimum, Social Security/Medicare, self-employment, and corporate taxes. The FairTax proposal integrates such features as a progressive national retail sales tax, dollar-for-dollar revenue replacement, and a rebate to ensure that no American pays such federal taxes up to the poverty level. Included in the FairTax Plan is the repeal of the 16th Amendment to the Constitution. The FairTax allows Americans to keep 100 percent of their paychecks (minus any state income taxes), ends corporate taxes and compliance costs hidden in the retail cost of goods and services, and fully funds the federal government while fulfilling the promise of Social Security and Medicare."
The FairTax Basics
The FairTax has been called the most thoroughly researched tax reform plan in recent history. This section offers a quick introduction to the FairTax and tax reform.
Scholarly research tells us that . . .
- The FairTax rate of 23 percent on a total taxable consumption base of $11.244 trillion will generate $2.586 trillion dollars $358 billion more than the taxes it replaces. 
- The FairTax has the broadest base and the lowest rate of any single-rate tax reform plan. 
- Real wages are 10.3 percent, 9.5 percent, and 9.2 percent higher in years 1, 10, and 25, respectively than would otherwise be the case. 
- Disposable personal income is higher than if the current tax system remains in place: 1.7 percent in year 1, 8.7 percent in year 5, and 11.8 percent in year 10. 
- The economy as measured by GDP is 2.4 percent higher in the first year and 11.3 percent higher by the 10th year than it would otherwise be. 
- Consumption increases by 2.4 percent more in the first year, which grows to 11.7 percent more by the tenth year than it would be if the current system were to remain in place. 
- The increase in consumption is fueled by the 1.7 percent increase in disposable (after-tax) personal income that accompanies the rise in incomes from capital and labor once the FairTax is enacted. 
- By the 10th year, consumption increases by 11.7 percent over what it would be if the current tax system remained in place, and disposable income is up by 11.8 percent. 
- Over time, the FairTax benefits all income groups. Of 42 household types (classified by income, marital status, age), all have lower average remaining lifetime tax rates under the FairTax than they would experience under the current tax system. 
- Implementing the FairTax at a 23 percent rate gives the poorest members of the generation born in 1990 a 13.5 percent improvement in economic well-being; their middle class and rich contemporaries experience a 5 percent and 2 percent improvement, respectively. 
- Based on standard measures of tax burden, the FairTax is more progressive than the individual income tax, payroll tax, and the corporate income tax. 
- Charitable giving increases by $2.1 billion (about 1 percent) in the first year over what it would be if the current system remained in place, by 2.4 percent in year 10, and by 5 percent in year 20. 
- On average, states could cut their sales tax rates by more than half, or 3.2 percentage points from 5.4 to 2.2 percent, if they conformed their state sales tax bases to the FairTax base. 
- The FairTax provides the equivalent of a supercharged mortgage interest deduction, reducing the true cost of buying a home by 19 percent.