Make America Great Again? Abolish the IRS
Abolishing the IRS is certainly an idea that’s time has NOT yet come. Maybe it never will.
I am realistic enough to know that such a proposal would-be dead-on arrival in Congress today. Even some of the conservative freedom-minded members would not take up such a cause. And how would it even be possible? Is it even a good idea?
As a preface to this commentary, we should know that the income tax was not part of the Constitution. In fact, our founding document essentially prevented the kind of income tax we have today. That is why it required the passage of the 16th Amendment in 1913 to create the modern income tax.
Before getting into the “how” it could be possible to abolish the IRS, let us consider the “why” – generally and specifically. Just imagine a world without the infernal Internal Revenue Service. If this commentary were a movie, we are at the point where the screen blurs or undulates as we drift off into that world of imagination and find …
- No more of these complex filings – trying balancing your income against all the available deductions and tax credits. If you are not using the short form, it is highly likely that you have missed potential deductions.
- No more need for teams of experienced and expensive accountants and lawyers venturing through the labyrinth of the mindboggling rules and applications. And no more resentment because you cannot afford teams of experienced land expensive lawyers and accountants.
- No more scary audits – or even the fear of an audit — that will cost you more money to comply with than the taxes you owe.
- No more annual Deduction Gamble Game – in which you try to score as many deductions as you can. Only the “house” – the IRS –will decide which of your deduction bets are acceptable and which are not. They will only tell you when you took one inappropriately – never when you missed a legitimate one.
- No more summary seizures of your bank accounts or your home.
- No more loopholes that seem to be designed only for the wealthiest Americans. The millionaire will never again contribute less to the operation of the federal government than his secretary.
- No more requirement to reveal how you choose to spend your hard-earned money – how much you give to charity or how many medical bills you have.
- No more paying the government in advance – hoping and praying you may get a least some of your money back. Or fearing that you just may have to cough up more.
- No more frustration in dealing with the IRS.
It is upon this tenth point that I bring in a specific, anecdotal, and yet not uncommon case. This is a real case of someone I will identify as Taxpayer A.
Taxpayer A filed his tax return early – in January – in hope of getting his refund quickly – at least quick by federal government standards. He was informed that it would take up to 21 days. That would put it around the first of February.
But no check arrived by the first of February … or the first or March, or the first of April, or the first of May … and counting.
Soon after the promised 21-day commitment passed, Taxpayer A started to contact the IRS with increasing frequency as his frustration grew. He called every IRS number he could find. In most cases, he was greeted with “Due to the unusually high volume of calls ….” There were no opportunities to leave voicemail messages. After being informed of the USUAL unusually high volume, the IRS essentially hung up on him.
In one case, the electronic voice suggested he make an appointment at a local IRS office. With some hope in his heart, he called the recommended number. “Due to the unusually high volume of ….” Click.
Coincidental to his phone efforts, Taxpayer A sent emails to every IRS address he could find virtually every day – without a single response. Not even “Due to the unusually high volume of ….”
Taxpayer A will continue to pursue HIS money – and I assume he will eventually get it. But imagine not having to go through all that. Oh … and by the way, Taxpayer A is a real person, but not me.
So, what about the “how” of abolishing the IRS?
Though there are a lot of debatable points, the general idea is to establish a national sales tax – but ONLY in conjunction with the abolishment of the enabling 16th Amendment. The last thing America needs is giving the big spending politicians and bureaucrats in Washington an income tax AND a sales tax. I saw what that did for my home state of Illinois.
The national sales tax could be slightly progressive – an excise tax on luxury items and no taxes on essentials, such as food and medicine — because all sales taxes are regressive in that they hit hardest on the poorest. That is why taxing corporations is a folly. A corporate tax is essentially a sales tax on the consumer because all taxes – like all other corporate expenses – are calculated into the sale price.
However, businesses are experienced as tax collectors that take the money from you and me and give it to Uncle Sam, or one of his fifty offspring. That infrastructure is already in place and operating.
Under a national sales tax, we would all be paying our taxes when we purchase any goods or services – and our tax burden would automatically be apportioned by our income level – the wealthy, who spend a lot more, would pay a lot more. That is how the state and city sales taxes work.
Many believe that abolishing the IRS and income tax is an impractical idea. Politically, they are correct. The politicians and the powerful income tax lobby love the income tax. But it is not an impractical idea operationally or economically.
In fact, I now live in a state – Florida – that does very well without an income tax. And we Floridians are not alone. Alaska, Nevada, New Hampshire, South Dakota, Tennessee, Texas and Washington State do not have income taxes. And for the most part, these are states with very healthy economies. Compare that to the economics of the high income tax states.
I am very likely to be too old to ever see a national income tax, but I hope for the sake of future generations, it will gain political gravitas sometime in the future.
So, there ‘tis.