Malo periculosam, libertatem quam quietam servitutem.



April 2015

Everyone Wants a Simpler Tax Code, Right?

Written by , Posted in General/Misc.

It seems obvious. The tax code is a complicated mess that everyone agrees should be simplified. Yet it doesn’t happen. Why not?

As it turns out, quite a few people don’t want to be rid of the current code, as I explain in this recent column at EveryJoe.

Sadly, tax code opacity and complexity is seen as a feature by the ruling class. The problem has been understood for decades yet only ever gets worse. Nothing gets done about it because politicians and the parasite class benefit tremendously from the complexity of the tax code, and as far as they are concerned, the less that you know is being taken from your wallet, the better.

First and foremost, a complex tax system makes it easier for politicians to reward their friends and allies by auctioning off loopholes in exchange for campaign dollars. K Street is filled with lobbyists that make a mint off of securing favorable tax treatment for special interests. These deals only work because no one on the outside can possibly track what any particular change to an obscure section of the byzantine tax code means in the real world.

Another significant political benefit of the withholding system is that it reduces the taxpayer anger toward Washington that would otherwise be felt during tax season. Paradoxically, some taxpayers even look forward to tax day because they will get a refund! What’s not great about getting money, right? Nevermind that it was money they worked for in the first place, and that by overpaying the IRS throughout the year they’ve effectively reduced the value of their earnings (there’s no interest from forced loans to the IRS). Yet taxpayers still perceive the influx as a positive event, and that’s good for politicians who like to tax and spend.

Find the rest of the piece here.