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Comment by tdeck | Hacker News Reader

This is exactly where we're at. The CBO has estimated that every additional dollar spent on IRS enforcement would yield an average $2 of additional revenue, increasing to over $6 by 2018 [1]. But certain political factions (can you guess which ones?) have, as a matter of policy, intentionally starved the IRS of funding to prevent them from enforcing compliance and collecting taxes.

[1]: Page 32, https://www.cbo.gov/sites/default/files/114th-congress-2015-...

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I guess the thing that worries me is how would I know that the increased enforcement budget would actually go towards the ultra-rich? I make a middle-class income, not enough that it really makes sense to hire an accountant. The tax code is complicated enough that I'm sure I screwed up somewhere doing my taxes --- I just try to muddle my way through it as best I can year after year. I'm sure the IRS could get more money harassing thousands of people like me instead of a single ultra-wealthy individual since we don't have the resources to fight the IRS but the ultra-wealthy do.

Agreed, I know the feeling well. It's a crazy mess of a system where people with very straightforward sources of income and deductions end up unsure every year whether they've done their tax returns right. This is why other countries just fill them out for you.

I really understand your frustration and uncertainty, and to be frank; you don't know for sure that the IRS would chase after rich people.

But let me float this: Guess which parties/party wanted the tax code that complicated to begin with? The first step to fixing it would be to not align yourself with the ones who caused the issue.

Simpler tax code would make it less worrysome for regular plebs (us) to fill out our taxes, meaning the lower/middle class that pays their taxes would ensure they weren't in danger, and IRS would have an easier time chasing down tax avoiders.

The people who complicated the tax codes and also wants to uninsure tens of millions of people to save a few bucks for rich people won't help you.

The problem I have with the tax simplification folks is that they're generally disingenuous about the fact that they're proposing moving from a progressive to a much flatter tax code. Or at least ignorant about the differences.

I'm sure a lot of the language and ideas they're parroting are coming from conservative talk radio, hence the blind spots. But it really soured me on the US tax simplification debate.

> The problem I have with the tax simplification folks is that they're generally disingenuous about the fact that they're proposing moving from a progressive to a much flatter tax code. Or at least ignorant about the differences.

Whole heartedly agree. Simplification and flatter tax code should be separate discussions, with separate conclusions.

Here's a simple, progressive income tax:

1. IRS determines the median for personal income (total household income divided by household size), and publishes it no later than January 1.

2. Your taxable income is your household income minus the published median from #1 times the number of people in your household. If this is less than or equal to zero, pay no tax.

3. Those with positive taxable income pay x% of that amount as tax, with x set according to the requirements of the previous year's budget, but not to exceed a statutory limit of y%.

If you take the median income as a proxy for spending, this tax thus approximates a flat tax on the annual increase in household wealth.

The thing is, you can greatly simplify the tax code and still have progressive tax brackets. Looking up the total amount due in the back of the tax booklet (or more realistically having software calculate the total due) is the easy part of doing one's taxes.

Cut out the various deductions and credits and additions to income etc. to make things simple. Then calculating tax due becomes a simple table lookup or addition of amounts from multiple tables. 3rd grade math. We don't need to set a single universal x% tax rate to make things easy.

Consider that the only reason we have "tax brackets" is because many people apparently cannot be relied upon to calculate the results of an intractably complex polynomial function such as f(x) = 0.40x - c or a choice function like MAX( f(x), 0 ).

Perfect, yes, excellent distinction.

I'm all in favor of a vastly simpler tax code, but I'm also in favor of a vastly more progressive tax code. These two things aren't in opposition to one another.

At this point a flat income tax rate would be more progressive at the top end than the current system, especially if you wrap in medicare and social security taxes. Maybe start with a flat tax and move from there.

A flat tax by its vary nature and NOT be progressive. And even with how broken the tax code is, a flat tax still places a totally unfair burden on the poor.

If you take 20% of 20,000 bucks your tax on me is 4k which only leaves me 16k to live on (You would be extremely poor in US). 20% of 200k is 40k, which leaves me 160k to live on.

Return free filing, the ultimate in tax simplification, is also opposed by the politicians who claim to be for tax simplification. You could set up a progressive tax code in a way that requires computing non-trivial integrals, but as long as the math is done by the IRS, it would still be simpler than what we have today.

I suppose the market driven way would be to put IRS tax inspectors on commission. Perhaps above a certain amount per target; maybe for every extra dollar above six figures they bring in from "one" [1] individual, they can keep half.

[1] Where "one" is a bit of a fuzzy concept when you're dealing with multi-millionaires hiding their wealth through various shenanigans.

And also from that presentation:

>CBO projected a drop in the ROI after 2018 as taxpayers found new ways to evade taxes.

I mean, damn.

Do you have any faith that an IRS with more funding wouldn't just target foes of the party currently in power?

I mean, AFAIK technically taxes are voluntary. Is the IRS really under mandate to "enforce" taxation?

> AFAIK technically taxes are voluntary.

You are incorrect as a large number of would-be tax avoiders can attest.

e.g. Mr. Snipes

https://en.m.wikipedia.org/wiki/Wesley_Snipes

Wasn't it the falsified returns which generated the charges though?

No. He was convicted of failing to file returns.

Furthermore, he produced videos instructing the viewer on how he avoided paying income tax [1], then sold those videos. For income. That he didn't report.

[1]: https://www.youtube.com/watch?v=jL-F4-RDNz4

Or my personal favorite, Kent Hovind, who actually maintains those taxes were voluntary:

https://en.wikipedia.org/wiki/Kent_Hovind

Wow, what a read. There are two certainties in this life: death and taxes. Some people try to unsuccessfully avoid one or both :)

Well income tax was magically mandated without any sort of discussion so there's that. In the end the question is a question of hard power. If you have none, you are in no position to bargain. IMO giving government taxes that are used for purposes that may not agree with your personal sense of responsibility and morality may itself be immoral, for instance if the government uses your taxes to start wars you want nothing to do with. For infrastructure and education though they are fine regardless. They are always tooting the horns of voting with your dollars, in this case where is the voice of voting with your dollars as to what gets done with your money. /rant.

That seems redundant when you can vote with your... vote.

(Also: the sixteenth amendment?)

When you vote, you are not voting for anything or anyone substantial. Party A and Party B have the exact same policies with simply different political tones and groups of elites that they support.

The 16th amendment was adopted on February 3, 1913. Good to read its history: https://en.wikipedia.org/wiki/Sixteenth_Amendment_to_the_Uni... and how controversy still stands despite a century of litigation.

> The 16th amendment was adopted on February 3, 1913.

Yes. 4 years after congress passed the amendment, it was ratified by the 36th state and adopted. In no way was this "magically mandated without any sort of discussion".

>>Party A and Party B have the exact same policies

No they don't.

But you can also vote in primaries where there's a wider array of candidates. Plus many elections have ballot measures enabling you to vote for or against specific items.

You're just unwilling to admit that your views aren't broadly popular.

> Well income tax was magically mandated without any sort of discussion so there's that.

The nation literally passed a constitutional amendment specifically to allow direct, unapportioned income tax.

There's a wonderful old sitcom called "The Goode Life" where one of the characters walks in to the council offices to pay her council tax and proceeds to itemize and declare which services she is unwilling to pay for as they were unsatisfactory...

You are confusing practice, or customary, with technical (constitutional law), which I would include political philosphy and the unalienable rights of man as identified by Rosseu.

If I cannot choose to not pay taxes, then I have been denied the right to choose, then it is a forced subjugation of my free will. Correct would be to give my taxes voluntarily, according to my disposition and agreement with the government.

If you are profoundly 'contra' what the government is doing, then how can you be forced to help with activities that you believe to be deeply detrimental to the well-being of yourself, others, and all life on earth and beyond?

Tolstoy argues this point very well in his book "The Kingdom of God is Within You." He essentially says that if we pay taxes to a government that kills innocents or tortures Arabs their blood is on our (the taxpayers') hands.

If the government is doing something that I find to be deplorable then I have the moral obligation to find a way to avoid contributing to such array of horrors.

No, you are confusing philosophy with law.

> If you are profoundly 'contra' what the government is doing, then how can you be forced to help with activities that you believe to be deeply detrimental to the well-being of yourself, others, and all life on earth and beyond?

Because you participate in society and its infrastructure and services, paid for by taxes.

I'm sure there are uninhabited tundras where no one will bother you.

I guess you can say lots of things are technically voluntary. I suppose you can say if you choose not to volunteer there may be consequences.

"Voluntary" is an old-fashioned term of art; it means "you volunteer your version of events to the information to the IRS" rather than "the IRS sends you what they know".

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