The government would be very disappointed to learn people weren't making decisions based on a tax system that's filled with incentives to change the way people conduct their lives and businesses.
That are different kinds of taxes. There are taxes especially designed to steer behavior away from discouraged actions or towards encouraged actions and there are taxes that are mainly for funding. That is certainly no absolutely sharp distinction and all taxes can at least at times be used to steer behavior, but income taxes certainly do not exist to discourage having an income.
That's why, instead of trying to figure out what Congress intended, people should just worry about the law as written. Congress can always make changes.
That would work in an ideal world, but in the real world laws will have flaws. That is essentially exactly the same as with vulnerabilities. You find a vulnerability and responsibly disclose it, you are the good guy and maybe get a coffee mug or some money as reward. You exploit the vulnerability until someone else notices it, you are the bad guy and hopefully get punished.
As any other software developer I would certainly love if all the rules in the world were unambiguous and free of flaws, but that is nothing we can have, at least not at the moment. So we all have to deal with it and we all have to accept that the spirit is at times more important than the words.
And just to come back, nobody can seriously claim that they believed it was in the spirit of the law to pay no taxes at all. That is just not how or system works and everybody knows that, don't be surprised if you get punished for trying it anyway.
>That would work in an ideal world, but in the real world laws will have flaws.
Well, sure, and it's incumbent on Congress to fix them, not the bureaucracy or the courts. Of course there is some gray area where you can try to gain extra deductions through miscategorizating expenses and such, but that really a question of the letter of the law and not its spirit.
>And just to come back, nobody can seriously claim that they believed it was in the spirit of the law to pay no taxes at all.
That is entirely irrelevant and not even true for almost half the households in the US.
As far as I can tell, the difference in practice is whether the person speaking likes the entity taking the deduction, which closely correlated with whether the entity taking the deduction is perceived to have "too much" money.
You are probably in for a Nobel Price in economics if you manage to come up with a viable tax system that allows painting a black and white picture. But at least for the moment we are stuck with a gray scale picture where the border between tax avoidance and tax evasion is fuzzy and at least subject to some kind of subjectivity.
There's a very clear distinction: one is illegal, the other is legal. If you say someone is engaging in tax evasion, you're accusing them of a crime. If you say someone is engaging in tax avoidance, you're accusing them of following the tax code as written.
And if you just wish someone paid more in taxes than they're required to, then look closer at the things they're legally doing, decide which of them you'd rather not be legal, and argue against that. But that's not an argument about the behavior of that person; that's an argument about desired properties of tax law.
Even if you believe that some part of the tax code is currently immoral (and I certainly think there's a critical distinction between law and morality), it still doesn't make sense to voluntarily pay extra. Pay the legally required amount, and if you decide that the best possible use of your additional funds is to donate them to the government, do so; the Treasury Department (and specifically the "Bureau of the Public Debt") accepts voluntary additional payments, and they're even tax-deductible. Or, perhaps you can find an even better use of that money to have an impact on the world.
There's a very clear distinction: one is illegal, the other is legal. If you say someone is engaging in tax evasion, you're accusing them of a crime. If you say someone is engaging in tax avoidance, you're accusing them of following the tax code as written.
I am not a native speaker, tax mitigation seems to be the correct term that I should have used instead of tax evasion.
