Sunday, May 19, 2013

Why IRS Scandals Will Never End?

The tax laws and IRS enforcement efforts are guaranteed to result in political favoritism on a grand scale.  Why?  Because they are complicated and ambiguous.

The American people do not understand the tax laws in their own country.  One suspects that tax specialists don't understand these laws either.  That leaves a lot of latitude to regulators.  They can pick and choose, as we now know that they did in recent years.

Every so-called tax reform simply puts more complicated things into the tax laws.  

The income tax needs to be abolished.  There is no generally agreed way to define income (that's the main reason why tax laws are so complex).  Even value-added tax concepts suffer from problems of definition.

Better to go to a uniform national sales tax.  That could be easily understood by all Americans.  The only way a national sales tax could become problematic is if there were exceptions (for food, medicine, etc.).  There should be no exceptions.

Imagine how much time and money could be saved by abolishing the IRS and substituting a national sales tax.  You can always make equity arguments, of course, but simplicity and transparency would be of enormous benefit to the average American.

We could rent out the IRS headquarters to a charter school.

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