The government already controls taxes and thus citizens’ incomes. In a time when so many are worried about privacy, few voice any concern about the enormous privacy problems inherent in the forced full disclosure of the intimate details of one’s financial affairs.
Fiscal year 2019 is forecast to have federal revenue of $3.422 trillion, of which $1.688 trillion will be from individual income taxes. That means repealing the income tax and replacing it with nothing would take the federal budget not back to the founding era or even the nineteenth century but to the Clinton years.
If the IRS sent a pre-prepared tax return it would give the tax payer an advantage because the IRS would give away what it already knows. In the current situation the tax payer sends a return and the IRS compares it to the data they already have. The tax payer doesn't know what the IRS knows though.
In the very article, it's noted that Roskam was the direct recipient of campaign contributions from Intuit and H&R Block. To me, this is plain anti-establishment pandering, and ironic in that the anti-establishment movement was once considered the domain of radical leftists. That the people are better off having their taxes calculated by for-profit corporations that directly donate to the individuals who control the government seems counter-intuitive to me.
The contribution from Intuit was $13 600 over 10 years. During that same period there was also $21 200 from individuals who worked for Intuit. If we count all of that as being Intuit, that's a total of $34 800 over 10 years. For H&R Block, it was $2 500.
If $3.7k/year is enough to buy a Congressman's vote, a handful of middle class people in the district should be able to get together and easily afford to counter that. For a group of 10 like minded people, that's only $31/month each.
I think people generally get the causality wrong on the relationship between campaign contributions and the positions or votes of the politician. The politicians don't set their positions based on campaign contributions. It's usually the other way around--the contributors chose where to place their contributions based on the known positions and past votes of the politician. If that is not known, they place contributions based on party, on the assumption that the politician is going to generally go along with the party.
That's how it should be but often it's the other way around. Don't forget that most laws get written by lobbyists and the politicians are just a front for them.
There are few issues where the people in Congress have their own opinion but there are lots of other issues where a well spoken lobbyist with some cash has a big influence.
I agree that the contributions are really low. That why lobbying has a huge rate of return. You can get billions in tax breaks for a few million in expense.
The fact that campaign contributions are so small relative to the amount of money affected by these decisions is powerful evidence that they have extremely attenuated influence on the results.
@tzs’s theory makes much more sense: companies contribute to the candidates that are ideologically predisposed to them in hopes of ensuring they keep their seats.
I guess this part of your parent's comment was true!
I can see where cases like business expenses may still have to be itemized by the citizen, but for someone with just a W2 (and maybe an IRA) getting an itemized bill from the government would be so much more convenient (as some countries in Europe do) rather than going through all the paperwork associated with taxes. The level of understanding required to correctly file taxes is also a huge burden on all the people who are young, poor, uneducated, or immigrants (which is why even online filing with TurboTax is still not easy). No wonder why there are so many tax preparation offices in the cities from companies like H&R Block ready to suck up all their refunds....
Perhaps the only logical one that fits your worldview. There are many people here who believe that statement, and it is not preposterous that such people would elect someone who agrees with them.
> Why would it be better for citizens to not know their taxes, while the government clearly does know (or else how could they verify), and then have the citizen go through a confusing-as-fuck, detailed process before finally coming back to the government with their best guess in amount due?
The government does not know, or have the ability to easily verify, this information. Why do you think it "clearly" does? The IRS only audits a small fraction of returns, gives itself several years to do so, and invests significant manual labor in each.
I can see where cases like business expenses may still have to be itemized by the citizen, but for someone with just a W2 (and maybe an IRA) getting an itemized bill from the government would be so much more convenient (as some countries in Europe do) rather than going through all the paperwork associated with taxes.
The majority of Americans need to file two returns every year. A significant minority, like me, need to file three. These separate tax authorities do not communicate very well with each other and have different taxation rules. Ly understanding of most, if not all, European systems is that there is a single, central taxation authority. I don't see how you make this pre-filled form work otherwise.
Also worth noting that, for an American "with just a W2 (and maybe an IRA)" the form is short and takes, at most, 20 minutes to complete. In fact, my taxes aren't even complicated enough to warrant tax software. I only buy it because it lets me file my federal and NY returns electronically for free and I find paying $35 worth it to avoid the hassle of certified mail and manually writing everything out.
> The level of understanding required to correctly file taxes is also a huge burden on all the people who are young, poor, uneducated, or immigrants (which is why even online filing with TurboTax is still not easy).
I find the instructions to me more complicated than they need to be. That said, the understanding required to complete forms 1040EZ and 1040A (which is what almost everyone in those groups should be using) is not nearly as great as only believed.
At least since Obama took office, and the GOP side openly declared that their primary goal was to make Obama a one term president, there has been comparatively little actual work going on in the legislative branch. (That's not to say that both sides are not in bed with corporations, however.)
Can any employee of a company imagine the outcome if they told their boss, "No, I'm not doing any work that involves my colleague Bob (that I hate)."
Unfortunately a lot of people have bought into the "the other side is evil" nonsense. So they are doing their job.
Taxes aren’t a negotiation... 90% of taxes are known because IRS has all of the data already.
The strategic goal of any tax organization is to maximize voluntary compliance and invest enforcement for maximum return. Pre-prepared returns would eliminate most of the fraud committed by normal people.
I wouldn't call myself "anti-tax," but I definitely prefer to pay lower taxes, and as few flavors of tax as possible, so maybe that meets the definition you had in mind. I dislike paying income tax in significant part thanks to the painful process we use in the US. And that painful process is principally due to the complexity of our tax law and the IRS treating all taxpayers as guilty of fraud by default, expecting each to prove otherwise.
Given the modern surveillance state, the IRS could send most of us a form saying, "We know you owe $X more than you had deducted; pay up, citizen." But they do not. In fact, for most of us, the IRS could more seamlessly handle our withholdings so that April 15 is a complete non-event, but they don't do that either. Basically, they don't provide services to taxpayers. We're not customers.
Cutting close to 3 trilllon from the federal taxes would mean vast disruption and many older workers and other beneficiaries ending in deep poverty.
The undoubtedly terrible issue with income taxes is that they are complicated for almost no economic gain and at great inefficiency. And in this topic both parties agree to disagree: a flat income tax of 15% would be unwelcome by the progressive taxation democrats, and unwelcome by republican tax exemptionists. The US is very stuck on this issue.
"The problem is that the left and the right distrust each other and they are both right" - Milton Friedman.
Caesar got his due through overpriced goods and poor choices, as the government relied on tariffs and excise taxes.
We also didn’t need to support a war machine with tens of millions of people, didn’t have a social safety net, etc.
Massive sales taxes are even worse. Adding 20-30% to every economic transaction is a boat anchor that would kill most industry.
VAT is not quite equivalent to sales tax as it is only paid by the final consumer. (Businesses offset any VAT paid against against the VAT they collect on sales.)
I think the mental impact of a 40%+ tax on transactions would have a chilling effect on them.
Still sale taxes are generally regressive, even if they behave like VAT. The true step on federal taxes would be to simplify the system. Just a flat rate with no exemptions. The simple the system the less is spent trying to jimmy it, lobby it, etc.
This is unfortunately known for decades, and predicted accurately by Milton Friedman as a political problem, where both sides want different things, and both side actually get what they want politically.
And economists both left and right agree that its a good tax. I never quite got why property taxes are so popular in the us and land value tax isnt. It just makes plain sense.
California is the first state that should be implementing it: if it had it, its housing problems would dissapear quickly. Nimbyism would dissapear very quickly.
Also, their position is that simple filings allow the government too much control and that taxpayers are better represented by an entity that is incentivized to minimize their tax burden.
Still, I always found Intuit's lobbying efforts to fail Brad's (Brad Smith is, the CEO) "you wouldn't tell your mother" test and it was one of the main reasons I ended up leaving Intuit.
In Denmark we have had prefilled tax forms for I don’t know how many years. More than two decades. Nowadays its online. You log on and see your taxes and edit when necessary. It’s still unnecessarily complicated if you are not an employee, but for the 90 percent who receive salary as their only income and only have ordinary deductions it’s somewhat bareable although it can be hard to check if the tax authorities calculated the tax correctly.
Groups of people or interest groups should be allowed to bring their case to legislators to try to convince them.
It’s when the convincing them comes in the form of personally enriching the legislators that it turns into bribery and the problems occur.
I have nothing against the concept, as long as no money is involved and the playing field is levelled.
2017 lobbying, https://www.washingtonpost.com/news/the-switch/wp/2018/01/23...
Our system is composed of mutually revolving fictions. We pretend that campaign finance isn't corrupt, and we also pretend that all corruption that takes place is in the form of campaign finance.
I thought the revolving door principle was a known deficit in the western style political system (contra some others where politicians just get direct 'gifts').
Maybe not, then?
That was before SuperPACs were widespread, which make it easy to spread that money around.
The surprising thing used to be how cheaply politicians can be bought, and now it's how that can be done so legally.
* I'm not sure why the actually video of the segment isn't also available.
Money in lobbying is almost entirely paying lobbyists to make PowerPoint presentations to staffers: https://www.brookings.edu/wp-content/uploads/2016/06/06_lobb....
OpenSecrets very misleadingly attributes all contributions from a company’s employees to the company itself. It’s propaganda.
I’m not even a big believer in the idea that our elections are bought and sold. We get roughly the government we idiots vote for. And an underlooked fact is that we elect inexperienced people to office, give them inexperienced staff, have them vote on topics they often barely understand (think of anything tech related). One big part of what lobbyists do is just show up with fancy talking points designed to appeal to the particular legislator. But denying that there’s a lot of money sloshing around doesn’t make sense.
Shit, I can swing “tens of thousands.” Can you tell me how to get “millions” in pork? Shouldn’t YC companies just blow the $120,000 they get in campaign contributions?
Look how little Koch brothers pay to discredit most scientists and majorly influence the direction of this country:
Think about it: Top lobbying firms pull in under $50 million a year in revenue. If they were really controlling access to billions in government pork and favors, shouldn’t they be able to charge a lot more?
You just wouldn’t meet VC growth targets.
The biggest barriers to small companies doing business with government is lack of access and lack of understanding of the process.
A good procurement lobbyist and attorney can make a huge difference.
This is similar to the people that tell me, "perpetual energy machines exist, but the fossil fuel industry is suppressing them"
A mere combined 800k in contributions to many politicians allowed Disney to further extend the copyright life of Mickey Mouse: https://research.chicagobooth.edu/-/media/research/stigler/p...
If the 800k +1 was from a group with staying power likely to contribute more in the future maybe
Why can’t this be a public process with no direct access to the legislator ?
If the point is to change a public body’s behavior, it should be done in the open and with tracability. For me by definition it shouldn’t be lobbying but open discourse.
> But in the course of the argument, Justice Samuel Alito interrupted Stewart and inquired: "What's your answer to [the] point that there isn't any constitutional difference between the distribution of this movie on video [on] demand and providing access on the internet, providing DVDs, either through a commercial service or maybe in a public library, [or] providing the same thing in a book? Would the Constitution permit the restriction of all of those as well?" Stewart, an experienced litigator who had represented the government in campaign-finance cases at the Supreme Court before, responded that the provisions of McCain-Feingold could in fact be constitutionally applied to limit all those forms of speech. The law, he contended, would even require banning a book that made the same points as the Citizens United video.
> There was an audible gasp in the courtroom. Then Justice Alito spoke, it seemed, for the entire audience: "That's pretty incredible."
Edit: Perhaps instead of focusing on campaign finance reform, we should focus on polling reform, and expanding the house? If we used a better polling system, e.g. candidate ranking, and increased the number of representatives, then it would be much more costly to buy a majority.
I don't think it's controversial to say that if you equate money to speech in the political process, then rich people (and non-people entities) will always have more speech. By my reckoning, such a system favors creating laws which favor the existing rich, which gives them even more speech to protect and entrench themselves. If I was designing a societal feedback loop to create an oligarchy, it would look like that. If you look at American post-war anti-socialist propaganda from sources like the National Education Program, a large part of their assertion that American capitalism is morally just is our system's wide distribution of wealth. The situation has changed significantly since then. I believe equating money to political speech will accelerate that change.
Fortunately we have a really great way for people to directly express their opinion about who should be elected: a vote.
That sounds extremely un-democratic to me.
Don't get fooled with 'democracy' thing. Election and democratic process are the way for the elites to decide matters between themselves without resorting to civil wars/violence, in an orderly, regulated manner. They were invented for that purpose in the middle ages England which got tired of civil wars and serve that purpose perfectly.
'Opinions' of ordinary people are not important because they effectively, don't exist: propaganda decides what their opinions will be.
That’s a fascinating thesis, can you point me to sources on it?
“Public campaign finance” is no magic fix, rather it is welfare for already wealthy political parties.
Corruptioners are the best kinds of politicians you may have.
Democracy was most certainly not invented in the middle ages or in England. Neither of those statements is even remotely true. Democracy is a product of Ancient Greece around 300BC. And then the Romans after that. See:
There's no causal link between public funding and totalitarianism and there's no historical proof that this ever happened.
When and if democracy fails, it happens for a number of other reasons, but this is certainly more likely to happen, when a) there's no equality in voter's influence on the outcome, b) there's no fair competition between candidates.
Public funding usually addresses those two problems and at this moment does it quite successfully in Europe, which, despite all the recent turbulence and the rise of the far-right parties, is still in much better shape than USA, when it comes to the elections.
Your proposal is at complete odds with the US Constitution with respect to an individual's right to free speech. Lobbying creates a paper trail of sorts and is therefore more transparent (How do you think opensecrets exists?).
We are not talking about what your friend did, or what you are supporting. Those are actions that will move the society forward.
If there was a simple heuristic like whatever corporations want is bad and whatever individuals want is good, then governing wouldn't be hard. Policy would be easy and not full of complex dilemmas with multiple competing interest groups that all have roughly prima facie coherent perspectives and interests.
Some of these groups will of course be wrong on further examination, but sorting that out isn't some one line test.
Look at Amazon. They put out bids for a place to build HQ2, and states fall over themselves to accommodate them. Corporate donations to candidates are already illegal. It doesn’t matter—the CEO of a big employer can just call up a Congressman and say “hey, I employ 10,000 constituents in your district. It’d be a shame if anything happened to their jobs.”
Things like anti-trust suits, vague IP law, and domain name disputes disabused tech companies of that notion quickly. They couldn't afford not to get involved in lobbying.
Then you also have the dumb idea of super delegates, to which millions are donated by corporations since they have a much larger influence than individual voters.
The reality is that US is no longer a democracy, it’s a plutocracy where the wealthy have a far larger influence.
And since elections are getting more expensive every term, I predict almost every candidate to be a billionaire backed candidate. Bernie was an exception but couldn’t do much against billionaire backed Hillary.
That touches upon the fundamental problem of end justifying means... And in the case of lobbying the groups of interest that will prevade will be the ones with the biggest amount of cash in their pockets, which doesn't correlate often with the best ethics.
Why should YOU or you and your friends be allowed to lobby MY congressman if you're not in a district he or she represents? They're in office to represent their constituents, not whoever has the most money to throw their way. Lobbying should be limited to constituents only, not include gifts, donations, or further benefits post-office.
However I think a distinction must be made between citizen and petition lobbying and and the big-moneyed-corporate special-interest lobbying. When people are decrying the general term "lobbying" its mostly the latter.
This is not at all the same as what the framers had in mind with the right to “petition the government for redress of grievances” in the First Amendment. Big-moneyed special interest and influence was specifically something that James Madison was concerned about. I recommend reading "The Federalist Papers."
The US government doesn't represent the people. It only represents about 10% of the people; those who are the top income earners and whose view happen to align with the interests that represent the top industry groups.
YT may host content from any number of sources of varying quality. It would be more useful to address why the video itself is propaganda.
It's a really good study and worth reading. I've used the same study in a video I later made:
I have moved to the US very recently. I have actually filled my 2017 French revenue form today.
It took me 10 minutes and that's because I had to find how much I had paid home cleaning services (home employment is deductible), it could have been done in 2.
Even after paying 180 dollars to HRBlock, my US taxes were way less straightforward and took me hours.
The 2 jobs are comparable and should be just as easy to declare for.
It's worth ponying up a little extra for a CPA, or spending a little extra time reading the instructions on the tax forms and googling/asking online for answers.
I've only met a couple of people who can fill out ONLY a 1040/1040-EZ, and that was because they were still in college or younger.
Nearly half of all people file their taxes with a 1040EZ or a 1040 (instead of a 1040A).
No retirement accounts other than my 401k. I'm under the impression that there are no tax implications until I retire and start withdrawing (because my contributions are already deducted from my taxable income on my W-2 form).
No hobby or self-employment income. No charitable giving or other deductions that I consider worth the trouble of filing.
As soon as my employer made it hard for me to download my W-2, I withdrew consent to only receive an electronic copy.
I had to check a box saying that I don't own a TV (so I don't have to pay that tax)
I also had to connect to my home cleaning service website in order to know exactly how much I paid them in 2017.
That's pretty much it, everything else was already filled.
Since my employer has declared that I worked for them (I mean .. that's the case for most people except black market), the FISC (french IRS) already knows how much I made that year.
If you are freelancing, or another regime different from full time job in a company, it might be more complicated.
but for 90% of the people, you connect to the gov website, approve your taxes and that's it.
US has federal and state taxes. Both are obscure. AFAIK, there is no government website to do your taxes. No prefilling either of course.
So I had to google a lot, look for my w2, etc.
I used hr block since it looked easier than figuring out everything myself.
It was still more of an headache than my french taxes and I don't think that it was only because of my expat status.
i was curious about your comment
> Even after paying 180 dollars to HRBlock, my US taxes were way less straightforward and took me hours.
I used turbotax for both state and federal it imported and prefilled my adp w2 and imported my tax account from etrade.com. It took me 10 minutes to finish it.
http://www.impots.gouv.fr/ . (it would be taxes.gov.us here ) already has all the prefill that all these services have.
I guess it can always be argued that maybe corporations are more cost effective than a government.
We would need to compare the figures though, in France corporations don't spend millions bribing the government in order to do abandon the idea of improving the tax system.
> Even after paying 180 dollars to HRBlock, my US taxes were way less straightforward and took me hours.
The big question is "why does America seem to have no effective consumer lobbying groups"?
"NRA receives 350M/yr in 2014"
"NRA has received, in total, 80M from individual donors in the past 13 years"
"NRA received 22M from individual donors in 2014"
22M of 350M revenue means that individual donors are very small.
Where does the other 330M per year come from, if not individual donors?
Suggest you read John Lott to see how the media and manipulates gun statistics.
3. Programs they run
4. Income from investments
Of these, #1 and #2 constitute the bulk, with contributions roughly 50% more than memberships.
It is much better for Intuit and HR Block to openly lobby for complex tax code rather than paying bribes through backdoor.
Secondly, why are people re-electing the politicians who suck up to Intuit then ? It is because people do not care as much.
In US you have less choices AFAIK, just seen yesterday that one party owns a big TV network and some HNer commented that the other party should also buy a similar big network, there is no consideration that maybe there should me more then 2 choices, from what I see from outside US is that it is impossible to have a 3rd or 4rd option so you have to chose between 2 bad options each cycle.
If I am wrong please correct me, again this is how the things appear from us outside US (I never heard of a 3rd party or 3rd president candidate with a real chance)
Positions held by (relatively) successful third parties are quickly absorbed to some degree by one major party or both.
The net result is a weird mishmash of positions on either side of the aisle that no individual would actually choose. It also means disproportionate benefits for things that intensely benefit small portions of the population with mild downsides for the rest.
Despite all the concern, the national legislature has been fairly evenly divided over the last 25 years or so, giving control back and forth. This is even more true of the presidency. It's exceptional that a party will hold the presidency for more than two terms of office.
All that being said, I do think there could be some national consensus about things with little more explicit horse-trading. I could see a carbon tax passing, for instance, if it were attached to a bill requiring a balanced budget. But no major party could propose something like that without angering its base.
I can't cite chapter and verse, but I've seen stories about third parties being sued over every possible ballot application technicality, being excluded from debates, etc.
Consider that Bernie Sanders was a member of a third party as a senator, but ran as a democrat for president without changing any of his positions. Similarly, Trump had little relation to the modern Republican party and essentially took it over anyway. When Ron Paul, Donald Trump, and John McCain are all in the same party, you're talking about a pretty big tent.
In the USA, "parties" are more analogous to coalitions in parliamentary democracies. The party primaries play a tremendous and oft-overlooked role in the actual elections.
A new party is created, as an example, a green party, that is all for green energy, ecology, privacy (just an example)
This party could grab 10% then if the other 2 parties are balanced, they would have around 45% each, then the major parties would need support from the small party to pass some laws, for this support the green party would get back some of their ideas implemented.
Are there laws or money that block such thing to happen?
There are no laws backing it, and in fact the Green Party and many other parties do exist in the US. Some make it to Congress. The Presidential ballot is usually filled with a variety of different parties. State legislatures and even the federal legislature often have a little more variety. The smaller parties choose to caucus with the larger ones in what Europeans would call a coalition.
There are two political reasons it doesn't happen. Most people focus on the winner-take-all aspect of (some) final elections. This is a little misleading since not all elections are one round of winner-take-all in the first place), and almost all elections have at least a primary beforehand, making it minimally something at least akin to two-round voting.
The other reason is there's no need to. There is extremely little intra-party policing. I (I have actually done this, though I lost) can right now, make this my platform and file my paperwork to run as a Republican or a Democrat. I get the immediate benefit of all the massive party machinery in the general election if I win the primary election. When I win my election, I can push my issues to my hearts content, and by working with my nominal party, I am likely to get at least some minor legislative or executive wins. The more successful I am the more I will shift the politics of the entire party, especially if my platform proves popular with voters - more politicians in my "party" will take up my cause to help their own.
How do I choose which party? Well, I choose the party I think is more likely to work with me. I can, at any time, even after assuming office, switch parties and choose to caucus with someone else if I think I will be more successful that way. This happens more often thank you'd think.
The US doesn't have a ton of parties at the federal level because the two "parties" are really already representative of two broad coalitions in practice. You only see a third party rise en-masse during times of huge, sudden political re-alignments where the old coalition falls apart and a new one has to be formed. Even during "normal" times, though, you certainly have a lot of politicking based on the "real" parties within the coalition, and groups within the Republican or Democratic parties in Congress go vote with another group that aligns more with their interests. For example, the Republican party is a mix of libertarians, neoconservatives, Chamber of Commerce Republicans, Trump Republicans, and others. The Democratic party is a mix of environmentalists, social justice advocates, Chamber of Commerce Democrats, warhawks, Blue Dogs, the CBC, pro-labor folks, neoliberals, etc. It's a very messy picture and votes don't necessarily fall along coalition lines. Often, for example, the Blue Dog Democrats vote with Republicans, and Trump Republicans and pro-labor Democrats have some commonalities where they vote together. There's no rule requiring members to vote with their party, so they do as they like. If you flout the majority of the party often enough you might lose your shot at a a sweet committee assignment, but if you don't flout your party you might very well lose your election. Generally, the party will recognize when you can't vote with them due to your constituency and be perfectly ok with it.
- big parties will split if there are 2 wings inside (it could be some inner fight for power too)
- 2 parties will also completely merge (not just for a coalition) and make a new party , this probably happens if the parties are small
- parties can win an election, perform bad afterwards, gets few votes, then disappears, splits, merge
- the leader of the party has a big importance, his charisma can help or be the doom of a party, sometimes you get a big egomaniac in charge of a party and the idot does a lot of damage to that party
Btw I am not saying a system is better then other, I hate the politics, you see them criticizing a good idea just because is from the other side when they would probably would have done the same, you see valid corruption accusation named as political attacks (we have a big corruption problem here, the justice is moving in the right direction but the politicians are struggling to fight it)
“Lobbying” is literally any effort a person or group makes to influence a government decision-maker.
Do you want your government to do X ?
X => Ban Guns/Allow people to bear arms
X => Make abortions simple/Ban abortions totally
X => Enforce net neutrality/ Let markets handle it
Every person will always have a stand on this issue and will try all in his power to influence the government. Would you rather want it to be legal and open or underground black market is the question.
My choice is all but predetermined. The question of which ones suck up to Intuit basically doesn’t come into it.
The big problems with US tax preparation seem truly hard to solve. A huge number of Americans take deductions which are fundamentally hard to automatically report. It would be hard for every charity to talk to every tax authority. Another trouble is that tax laws at federal, state and local levels are weirdly different and sometimes incompatible.
The latest federal tax law eliminates the use of itemized deductions for about 90% of tax payers, however. This may nudge us closer to prefiled taxes.
The only tax preparers that do this charge quite a bit if your AGI is above a certain amount. The others make you do manual data entry. If you have a brokerage account with a lot of trades, it's over — you pretty much need to use a tax preparer that can import that information.
This is true even though the government already has that information from your employer and your brokerage. In GP's country, he doesn't have to do anything at all in these cases.
Every payer files 1099s and sends the payee a copy. It would be no hardship for charities to file analogous forms and send analogous copies to donors, although I suppose the chance of false filing would increase. To prevent that, just issue charities some secret identifier they write on the form that goes to IRS and don't write on the copy they send to the payer.
Let's say you want to build a road (to nowhere really) in Mississippi. Your company builds roads and you are pretty damn sure you will win the contract if it happens. You want Senator Cindy Hyde Smith to ear mark some federal cash for the project (s). How much would it cost? Answer: not much. She only has 200k of cash on hand. If you donate $50K you got a new best friend. If you give her 2k, you will probably land a dinner.
I'm not sure if it's true, but it's something to think about.
At the very least, it suggests that the strong laws on campaign financing in the US help pull lobbying into the light.
Lobbying is the lifeblood of American democracy, and the system was expressly designed for it, so its a little odd hearing you instead posit that it’s actually not.
Maybe you’re thinking of modern campaign financing?
I think it's worth adding that non pre-filled (i.e., the status quo) is also in the IRS's best interest. A person's mistake(s) allow for fines, interest, etc. The policing + enforcement also increases the IRS's head count. Layoffs by the fed gov never play well politically; to say nothing of lawyer and/or accountant fees incurred by the accused.
Bottom line: Everyone wins, except for the average American citizen. He / she is screwed. Again.
- The activity of lobbying, which is explicitly protected by the 1st amendment as petitioning the government for a redress of grievances.
- Contracts to pay someone else to engage in lobbying, which apparently used to be illegal.
- Giving gifts to legislators, which is illegal if quid-pro-quo.
 My source is https://priceonomics.com/when-lobbying-was-illegal/ though that does not itself cite any sources. I'd love if someone more familiar with legal history could comment on its accuracy.
I've read a thread like this before, prepare for lots of people from countries that aren't the US explaining that their taxes are way simpler.
We measure numbers that are easy to measure, like GDP or GDP PPP according to some basket, or unemployment rate.
But how much of it is real?
We have a ~18t GDP, but how much is actual productivity vs rent seeking?
We’re at 4% “unemployment”, but how many people have busywork jobs that don’t fundamentally need to be done? How many have crappy jobs / bad bosses / no security/ need a second or third job to make rent?
Without digging deeper, I think the top line numbers are misleading and lead to optimizing the wrong things.
I think the things we care about most are the things we aren’t measuring yet.
Also, the set of forms is a monster. There is a simple-looking main form with four pages, but you usually need two or three of the appendix forms as well (there are ~10 different appendices, some of which can be required multiple times). This still hides the true complexity of German tax law. Almost every field in every form has a stupidly long list of rules and exceptions attached.
Even as a single and empolyee, I need to fill out a few appendices (or rather my tax advisor does) plus a big set of of copies of proofs for the data in the forms (usually between 20 and 40 pages).
If you earned salary from one employer and used only a few standard deductions, then filing US taxes should be easy as well.
One of the other complications with US taxes is that payroll systems and the exemption formula make it hard to get your deductions exactly right (this happens in Canada too), because you have to be able to exactly predict your annual income. In the UK the “Pay As You Earn” system deducts exactly what’s needed as you earn it. Even interest payments from the bank will have a line item for withheld taxes.
Second, in a graduated income tax system, this would result in decreasing take-home pay over the course of the year. Does that not cause some confusion/strife? Seems like plenty of people struggle to budget beyond paycheck-to-paycheck as it is (in the US).
The rates are fixed for most kinds of income that entities other than employers are concerned with. So a bank can deduct the dividends tax easily. Tax brackets for salary taxes exist, but so long as you have one employer only, and don't suddenly get a massive pay hike/cut, they will know your yearly income and can deduct given the correct bracket. There is no decrease in take-home pay and no confusion (I honestly didn't quite understand where the confusion would arise?)
If too much or too little has been paid for the whole year, that's simply mentioned at the bottom line of your prefilled online tax return form.
That's pretty much identical to US withholding. As long as your employer can easily predict your annual wage income, that part is withheld basically correctly. If you change jobs or experience an unusual bonus or hold multiple jobs, good luck.
> If too much or too little has been paid for the whole year, that's simply mentioned at the bottom line of your prefilled online tax return form.
Yeah, that's similar to the US, except the prefilled form isn't always online and is called a W-2. It is copied into the actual filed 1040 document and withholding is credited against your taxes owed.
The grandparent post claimed: "One of the other complications with US taxes is that payroll systems and the exemption formula make it hard to get your deductions exactly right (this happens in Canada too), because you have to be able to exactly predict your annual income. In the UK the “Pay As You Earn” system deducts exactly what’s needed as you earn it." (My emphasis added.)
That comment (and the name) suggests that — unlike the US — the UK withholds at the rate of your exact current tax bracket. If that's true (perhaps I am misreading it), your take-home pay would decrease as your tax rate increases over the year, assuming your gross pay is split evenly across pay statements.
And it is. Doing your taxes by hand on paper forms in that scenario would only take about 15 minutes.
I can confirm for Italy, it is the same, for very, very simple situations (employee or retired) the government provides a pre-filled tax form, with the addition, since a couple years that some (not always correct though, yet) medical expenses (that can be subtracted) are already filled in.
As soon as you have some other source of income (or some extraordinary expenses) you actually need an accountant/consultant.
If there were only 20,000 voters in each district then people would be able to run (and win) on personally meeting all the voters. No need for advertising and the money this requires. If you got rid off all the political staff then it wouldn’t even cost anymore.
Ironically, just last year, Massachusetts got rid of its own simple, free online tool for filing state taxes, and instead directs residents to commercial offerings.
And you know what? It works! Every year I write a check to pay our marriage penalty and fume about how it. I think it’s responsible for why middle and lower income Americans feel like they’re over taxed (even though they pay much less taxes than in europe).
FWIW, the marriage penalty almost completely disappears in the 2018 tax reforms. There is still a higher rate for very high earning couples than for very high earning singles, and some deductions are not doubled for couples, but most of the tax brackets now line up as exactly double the single bracket (up to the 32% bracket). This markedly closer than prior years.
Seems like a bad strategy. Most people celebrate their return.
I also wouldn’t have a problem with them getting rid of all the weird rules around certain deductions. Example, is web hosting a utility or subscription service?
I have a belief that we should get rid of tax-withholding, and have people just write a big check (or receive a EITC check) for all of their taxes at the end of the year.
To me (and I think many republicans), hiding the taxes you pay with withholding is really pretty slimy.
If you ended withholding, tons of people would spend too much during the year, not have enough saved to pay their taxes, and get into serious trouble. It would be the mirror of how so many idiots are giddy about their refund each April, except instead of feeling like they got a windfall, they’d end up with massive penalties.
You could argue that it’s their own fault and they should be more responsible. I’d agree that they should, but they won’t, any more than they’ll be responsible enough to read their pay stubs and understand their withholding.
Reminded me of this article by Tyler Cowen
The IRS should really advocate for this since it makes their jobs easier due to people making less mistakes. The IRS also has it's own lobby group - the US Congress. It's just not good at lobbying for the IRS...or Americans.
The system where money translates into such disproportionate control over the law is broken. Two cultural aspects in America are also factors: 1. Corporations are in many aspects viewed as persons (e.g. they're afforded human rights such as freedom of speech), and 2. half of the voting population doesn't vote.
That's already illegal; it's called bribery.
Feels much better to do it all yourself and declare This is what I’m going to pay. It’s a careful distinction.