Tax is a necessity. It is. Fundamentally, our country needs to have a tax system that allows the economy to keep moving forward economically.
That said, there's a problem: It's not working.
There's a few reasons that I believe it's not working, and I'm going to touch on a few of them.
1. There's tax, and then there's tax, and then there's more tax. Oh, and don't forget about that other tax that you were supposed to know about. Oh, can't pay that tax? No problem. Here's a fine worth double/triple/quintuple your
Income tax makes a lot of sense...except when there's sales tax. Yes, I know sales tax is generally a state/city tax, but still. A sales tax IS income tax. It's the same thing. It's taking a percentage of what you made. Secondly: you have a tax, basically another form of income tax, called something that I don't care to type out or get into, that's taken out of your check each pay period. Oh, and the kicker? When you're taxed at the end of the year, you're not taxed your net. Net = income after all the stuff taken out of your check. You're taxed on your GROSS income. This is the line that shows up on your pay stub that is always roughly 300-500 (depending what you make, could be even more) more than you actually have in hand and are able to use. Now, obviously if you're in the 15% tax bracket...meaning you make less than whatever it is now, $75,000, then you'll like get a tax refund so none of that really matters to you. HOWEVER, if you're a student who is claimed as a dependent by your parents with a good paying job, then you, specifically, get pittance, despite all of those tax dollars taken out of your check throughout the year, and your parents get a little more, which is still pittance compared to what the government took from you.
2. The Government takes money from you in more ways than just tax. One of those ways is through tolls.
Some roads are specifically funded by the tolls drivers pay for, so those roads make a lot of sense to me. I'm sure people still hate paying for those tolls, but it's the price you pay if you want the road to not be bumpy, pot-holey, etc.
A lot of toll roads, though, are not that way. For instance, our good 'ol Pennsylvania Turnpike route 276 is one road that can be described as the bane of my existence. * The main reason it's so terrible is more so because I-76 is worse. The only reason the PA turnpike is even used to go East and West is generally because I-76 was so poorly constructed. How people use that road to get to work with the umteen bottle-necks every mile is beyond me. It's frustrating enough using a toll road--a money you pay to use--that takes basically just as long, maybe cutting out 5 minutes.
3. The IRS has stake in your tax prep services.
That's right! When you go to H&R Block, use TurboTax, etc., who do you think is moderating, and partially capitalizing, on their revenue? Yup, the government. They'd like you to believe that's a lie since those companies I mentioned are public entities, but let's take a closer look here... The government wants your money. The government wants to make sure it gets as much of your money as possible. The government will never go after you if you do not do your taxes at year end when you're expected to get a refund. They only do that when they are expecting to get big bucks. So, these tax prep services guide us, for the the fee of whatever they charge per tax form (I'd say $150 bucks on average), to pay the government. You bet your ass the government is even getting a cut from that!**
Ultimately, we need tax reform big time. If the government ends up getting the money you earn in all these different ways, then how can they say that money is funneling back into the economy correctly?
Answer: They can't.
- PatInTheHat
* Here's the turnpike comission's 10K. I know it might be a lot of gobbelty goop for those of you out there who don't look at 10K's on the regular, but check out page 135 that summarizes their income statements for the last 10 years. Starting in 2008, you'll notice an interesting line item: Payments to PennDot which show expenses near 800 million allowing the road to lose money(at least, that's what they want you to see) since -.- In other words, the government is charging the governement to do government things. Wut. http://www.paturnpike.com/geninfo/PTC_CAFR_14-13.pdf
** I'm not the only person who has this in mind. http://www.cato.org/blog/hr-block-irs-unholy-alliance-ransack-taxpayers
Tax probably is one of the most pondered upon problem by many. It seems like when you think you’re already done with it, more tax tend to pop up every now and then. Though, I say these things aren’t that difficult for those are savvy enough to hone their mathematical skills. Anyway, I hope things are a lot smoother for you now. Thanks for sharing your thoughts on this matter, Patrick!
ReplyDeleteWanda Hanson @ Tax Tiger