In an opinion piece for The Daily Caller and on his site, Rep. Peter Roskam, R-Ill., said “making the tax collector also the tax preparer creates an inherent conflict of interest while forcing citizens to relinquish control of their taxes to the government.”
The government already controls taxes and thus citizens’ incomes. In a time when so many are worried about privacy, few voice any concern about the enormous privacy problems inherent in the forced full disclosure of the intimate details of one’s financial affairs.
Fiscal year 2019 is forecast to have federal revenue of $3.422 trillion[0], of which $1.688 trillion will be from individual income taxes. That means repealing the income tax and replacing it with nothing would take the federal budget not back to the founding era or even the nineteenth century but to the Clinton years[1].
This quote is just another example of willful misunderstanding of issues by the people in Congress. They don't even try to understand an issue but stick to some talking points that make sense only on the surface. It's really infuriating that such idiots are allowed to participate in the discussion of important issues.
The same happens in health care.
If the IRS sent a pre-prepared tax return it would give the tax payer an advantage because the IRS would give away what it already knows. In the current situation the tax payer sends a return and the IRS compares it to the data they already have. The tax payer doesn't know what the IRS knows though.
"It is difficult to get a man to understand something, when his salary depends upon his not understanding it!"
In the very article, it's noted that Roskam was the direct recipient of campaign contributions from Intuit and H&R Block. To me, this is plain anti-establishment pandering, and ironic in that the anti-establishment movement was once considered the ___domain of radical leftists. That the people are better off having their taxes calculated by for-profit corporations that directly donate to the individuals who control the government seems counter-intuitive to me.
> In the very article, it's noted that Roskam was the direct recipient of campaign contributions from Intuit and H&R Block.
The contribution from Intuit was $13 600 over 10 years. During that same period there was also $21 200 from individuals who worked for Intuit. If we count all of that as being Intuit, that's a total of $34 800 over 10 years. For H&R Block, it was $2 500.
If $3.7k/year is enough to buy a Congressman's vote, a handful of middle class people in the district should be able to get together and easily afford to counter that. For a group of 10 like minded people, that's only $31/month each.
I think people generally get the causality wrong on the relationship between campaign contributions and the positions or votes of the politician. The politicians don't set their positions based on campaign contributions. It's usually the other way around--the contributors chose where to place their contributions based on the known positions and past votes of the politician. If that is not known, they place contributions based on party, on the assumption that the politician is going to generally go along with the party.
"The politicians don't set their positions based on campaign contributions. It's usually the other way around--the contributors chose where to place their contributions based on the known positions and past votes of the politician."
That's how it should be but often it's the other way around. Don't forget that most laws get written by lobbyists and the politicians are just a front for them.
There are few issues where the people in Congress have their own opinion but there are lots of other issues where a well spoken lobbyist with some cash has a big influence.
I agree that the contributions are really low. That why lobbying has a huge rate of return. You can get billions in tax breaks for a few million in expense.
Your conclusion makes no sense. If you can get “billions in tax breaks for a few million in expense,” then every money manager who isn’t investing in campaign contributions is breaching their fiduciary duties. As a general economic principle, investment opportunities that return 1000x don’t just sit around, they get arbitraged until the rate of return drops to match the risk.
The fact that campaign contributions are so small relative to the amount of money affected by these decisions is powerful evidence that they have extremely attenuated influence on the results.
@tzs’s theory makes much more sense: companies contribute to the candidates that are ideologically predisposed to them in hopes of ensuring they keep their seats.
Campaign donations are the only logical explanation for a government employee, of all people, giving such a retarded statement. Why would it be better for citizens to not know their taxes, while the government clearly does know (or else how could they verify), and then have the citizen go through a confusing-as-fuck, detailed process before finally coming back to the government with their best guess in amount due?
I can see where cases like business expenses may still have to be itemized by the citizen, but for someone with just a W2 (and maybe an IRA) getting an itemized bill from the government would be so much more convenient (as some countries in Europe do) rather than going through all the paperwork associated with taxes. The level of understanding required to correctly file taxes is also a huge burden on all the people who are young, poor, uneducated, or immigrants (which is why even online filing with TurboTax is still not easy). No wonder why there are so many tax preparation offices in the cities from companies like H&R Block ready to suck up all their refunds....
> Campaign donations are the only logical explanation for a government employee, of all people, giving such a retarded statement.
Perhaps the only logical one that fits your worldview. There are many people here who believe that statement, and it is not preposterous that such people would elect someone who agrees with them.
> Why would it be better for citizens to not know their taxes, while the government clearly does know (or else how could they verify), and then have the citizen go through a confusing-as-fuck, detailed process before finally coming back to the government with their best guess in amount due?
The government does not know, or have the ability to easily verify, this information. Why do you think it "clearly" does? The IRS only audits a small fraction of returns, gives itself several years to do so, and invests significant manual labor in each.
I can see where cases like business expenses may still have to be itemized by the citizen, but for someone with just a W2 (and maybe an IRA) getting an itemized bill from the government would be so much more convenient (as some countries in Europe do) rather than going through all the paperwork associated with taxes.
The majority of Americans need to file two returns every year. A significant minority, like me, need to file three. These separate tax authorities do not communicate very well with each other and have different taxation rules. Ly understanding of most, if not all, European systems is that there is a single, central taxation authority. I don't see how you make this pre-filled form work otherwise.
Also worth noting that, for an American "with just a W2 (and maybe an IRA)" the form is short and takes, at most, 20 minutes to complete. In fact, my taxes aren't even complicated enough to warrant tax software. I only buy it because it lets me file my federal and NY returns electronically for free and I find paying $35 worth it to avoid the hassle of certified mail and manually writing everything out.
> The level of understanding required to correctly file taxes is also a huge burden on all the people who are young, poor, uneducated, or immigrants (which is why even online filing with TurboTax is still not easy).
I find the instructions to me more complicated than they need to be. That said, the understanding required to complete forms 1040EZ and 1040A (which is what almost everyone in those groups should be using) is not nearly as great as only believed.
Politicians call it “staying on message.” Answer the questions you want to answer, and for the ones you don’t, answer what they should have asked. True and false don’t matter but how confidently and steadfastly you stick to your position.
Reminds me of the typical middle manager in a corporation. Best way to survive is to just confidently repeat what the top guys tell you and change your opinion based on political trends.
What you just described applies to almost every consideration that Congress makes. In most cases they know nothing about what they discuss. But in fact, nowadays they really don't discuss much - they just take prepared bills from lobby groups and ram them through using the power of majority.
At least since Obama took office, and the GOP side openly declared that their primary goal was to make Obama a one term president, there has been comparatively little actual work going on in the legislative branch. (That's not to say that both sides are not in bed with corporations, however.)
I think it was already in the 90s or since Bush 43 that the parties declared each other as enemies that can't be talked to. I still remember listening to back then House Speaker DeLay who openly declared in along interview that the other side was the enemy and that there was no room for negotiation and the only possible outcome was full victory. That was pretty shocking to me expressed to openly.
The thing is, that kind of talk and behavior should result in immediate firing and replacement. These people are employees of the government that is paid for by the people, and they are supposed to be servants of the public (interest). By openly stating that they will not do their job, they are admitting that they are unfit for the position.
Can any employee of a company imagine the outcome if they told their boss, "No, I'm not doing any work that involves my colleague Bob (that I hate)."
" The thing is, that kind of talk and behavior should result in immediate firing and replacement. These people are employees of the government that is paid for by the people, and they are supposed to be servants of the public (interest). By openly stating that they will not do their job, they are admitting that they are unfit for the position."
Unfortunately a lot of people have bought into the "the other side is evil" nonsense. So they are doing their job.
That's an interesting point you bring up. By holding their cards to their chest, the IRS ensures there is significant risk in tax evasion. If they were to send out a pre-prepared return, any mistake the IRS made there in a filer's favor would be much less likely to be caught as long as the filer went along with it. By not revealing in advance what they know they incentivize the filer to be honest and thorough.
Taxes aren’t a negotiation... 90% of taxes are known because IRS has all of the data already.
The strategic goal of any tax organization is to maximize voluntary compliance and invest enforcement for maximum return. Pre-prepared returns would eliminate most of the fraud committed by normal people.
I think many or most anti-tax people do indeed favor proposals that simplify the process of paying taxes.
I wouldn't call myself "anti-tax," but I definitely prefer to pay lower taxes, and as few flavors of tax as possible, so maybe that meets the definition you had in mind. I dislike paying income tax in significant part thanks to the painful process we use in the US. And that painful process is principally due to the complexity of our tax law and the IRS treating all taxpayers as guilty of fraud by default, expecting each to prove otherwise.
Given the modern surveillance state, the IRS could send most of us a form saying, "We know you owe $X more than you had deducted; pay up, citizen." But they do not. In fact, for most of us, the IRS could more seamlessly handle our withholdings so that April 15 is a complete non-event, but they don't do that either. Basically, they don't provide services to taxpayers. We're not customers.
I am not sure what you are trying to say here in regards to the IRS sending a prefilled tax return bass in their knowledge and you then being able make corrections as you see fit.
I have a beef with income tax, but Im not sure it is worse than the other half being raised. Sales taxes also suck. Property taxes are better but still have some issues.
The undoubtedly terrible issue with income taxes is that they are complicated for almost no economic gain and at great inefficiency. And in this topic both parties agree to disagree: a flat income tax of 15% would be unwelcome by the progressive taxation democrats, and unwelcome by republican tax exemptionists. The US is very stuck on this issue.
"The problem is that the left and the right distrust each other and they are both right" - Milton Friedman.
Just imagine a time (pre 1913, US) when people could trade with each other without the government taking its cut, plus the nasty paperwork, and everyone not in compliance even when they want to be. I'd love to have some kind of land tax + national sales tax and get rid of income tax.
EU countries have VAT rates of 20-25% and do just fine. It’s nothing like enough to replace income tax though.
VAT is not quite equivalent to sales tax as it is only paid by the final consumer. (Businesses offset any VAT paid against against the VAT they collect on sales.)
That’s why I said add - I figure you need at least a 30% tax to replace federal income taxes, maybe more. State and local sales taxes aren’t anything to sneeze at either.
I think the mental impact of a 40%+ tax on transactions would have a chilling effect on them.
You overestimate what a vat or a sales tax would have to be to replace income tax.
Still sale taxes are generally regressive, even if they behave like VAT. The true step on federal taxes would be to simplify the system. Just a flat rate with no exemptions. The simple the system the less is spent trying to jimmy it, lobby it, etc.
This is unfortunately known for decades, and predicted accurately by Milton Friedman as a political problem, where both sides want different things, and both side actually get what they want politically.
What is interesting about the Land value tax is that, althought it might be crazy to think abuout at national level, it is perfectly reasonable and easy to do at the local level.
And economists both left and right agree that its a good tax. I never quite got why property taxes are so popular in the us and land value tax isnt. It just makes plain sense.
California is the first state that should be implementing it: if it had it, its housing problems would dissapear quickly. Nimbyism would dissapear very quickly.
I've heard of Georgism as far as it advocates a land tax as the fairest tax, but have not read anything in detail. I think the idea has merit and need to take the time to read about it in more detail and especially why people think it is a bad idea (besides that it is not the status quo).
It's worth noting that they're also against it getting too complex too. There's a sweet spot where most people feel comfortable using software to complete and file their returns but is also not too simple to need software.
Also, their position is that simple filings allow the government too much control and that taxpayers are better represented by an entity that is incentivized to minimize their tax burden.
Still, I always found Intuit's lobbying efforts to fail Brad's (Brad Smith is, the CEO) "you wouldn't tell your mother" test and it was one of the main reasons I ended up leaving Intuit.
Lobbying is a way for the rich to legally shortcircuit democracy. It’s legal corruption and as bad for democracy as the illegal counterpart.
In Denmark we have had prefilled tax forms for I don’t know how many years. More than two decades. Nowadays its online. You log on and see your taxes and edit when necessary. It’s still unnecessarily complicated if you are not an employee, but for the 90 percent who receive salary as their only income and only have ordinary deductions it’s somewhat bareable although it can be hard to check if the tax authorities calculated the tax correctly.
I don’t think lobbying per se is a problem. I have friends who have successfully lobbied in the the U.K. to get bills introduced to curb climate change. I support the Alltrials people, lobbying to ensure that the results from all medical trials are published whether ‘successful’ or not.
Groups of people or interest groups should be allowed to bring their case to legislators to try to convince them.
It’s when the convincing them comes in the form of personally enriching the legislators that it turns into bribery and the problems occur.
When there is money involved, it's corruption. I can't see it any other way. It also exclude the people/corporations that don't have that kind of money.
I have nothing against the concept, as long as no money is involved and the playing field is levelled.
That’s so little money compared to the size of the companies, and consistent with what I said elsewhere—it’s money used to pay lobbyists for making PowerPoint presentations on tech policy. That may or may not be bad because smaller players can’t afford similar influence, but it’s not the greasing palms that people think of when they rail against lobbying.
I suppose the actual corruption happens in the revolving door - politicians gain benefits afterward from the industry. Either you are in or out - and if you are in, there are lot of post political perks to be gained. The lobbyists role in all of this is to communicate what the corporations want, and formulate it into a message the politicians can sell to their constituencies with a straight face.
When I worked for Lucent I met someone who described himself as a "project management expert" at a regional conference. I thought, "holy shit I suck as project manager I should talk to this guy." Upon inquiry, I learned that he hadn't been on a project in years, and actually didn't teach any project management classes either. Ballast. After I related my confusion to someone else, I got a "Ssshhhh! That guy is some Senator's cousin. They have to keep him on for five years after the Senator leaves office." I.e., his job was more secure than that of literally anyone else at the conference. Did Lucent receive some consideration for this accommodation? Have they and Ma Bell done the same thing for decades?
Our system is composed of mutually revolving fictions. We pretend that campaign finance isn't corrupt, and we also pretend that all corruption that takes place is in the form of campaign finance.
"...we also pretend that all corruption that takes place is in the form of campaign finance."
I thought the revolving door principle was a known deficit in the western style political system (contra some others where politicians just get direct 'gifts').
Sure, I think that's corrupt. Not everyone agrees with me. For instance, there are lots of FCC fans on HN, and that body is built on the revolving door.
It doesn't take much money to influence politics in the US. It's confusing in that sense but politicians are often caught taking very small 5 and 6-figure bribes.
A number of years ago I figured out the required budget to pay for the entirety of the winning campaigns for the most expensive 51% of senators and representatives. IIRC it came out to a quarter's profits for one of the megacorporations.
That was before SuperPACs were widespread, which make it easy to spread that money around.
The surprising thing used to be how cheaply politicians can be bought, and now it's how that can be done so legally.
Isn’t that a huge red flag to your conclusion, though? Generally (legal) avenues for outsize returns don’t just sit around waiting to be exploited cheaply. Look at how much VC money is chasing below market returns. We’re supposed to believe that lobbying yields huge returns but megacorps like Yahoo are investing just $10-20 million a year on it?
Don't assume that lobbying is the only form of corruption. There's lots of illegal stuff too. Federal officials seem reluctant to investigate more than sporadically. It's almost as if self-interest affects their actions too.
In the context ("level playing field") of this sub-thread, that money is enough to tilt the playing field, not only against little guys, but against other large corporations.
What if instead of paying money to buy votes, companies could donate funds to fund programs and initiatives instead? I suppose this wouldn't quite work because the reality is that these companies are paying for laws and regulation to entrench their current status by making it more difficult for new comers and competitors.
Lobbying has little to do with campaign contributions. Lobbyists are limited to $2,300 like everyone else. Especially corporate lobbying, because corporate campaign contributions to candidates are banned.
Neither of your links counter what rayiner said. The first specifically says the per-candidate, per-election limits were left in place. The second is just a sum total of all the contributions to Paul Ryan over his federal political career (which has nothing to do with the limits on individual contributors). Neither says that lobbyists have any different limits than I do.
When a high paid lobbyist shows up to advocate for a position, the idea that it’s just that lobbyist’s personal contribution speaking is silly. Whoever spent all that money on their salary will also find (generally legal) ways to get way more than $2300 to the relevant politicians. There are PACs, all the other members of the lobbying firm, executives at the companies that contribute to the lobbying group, etc. Think of the lobbying operation as in part a signal “a bunch of people put a bunch of money in play to send me here”. Your opinion implies that all these people can’t put 2+2 together.
I’m not even a big believer in the idea that our elections are bought and sold. We get roughly the government we idiots vote for. And an underlooked fact is that we elect inexperienced people to office, give them inexperienced staff, have them vote on topics they often barely understand (think of anything tech related). One big part of what lobbyists do is just show up with fancy talking points designed to appeal to the particular legislator. But denying that there’s a lot of money sloshing around doesn’t make sense.
You don't think money or favors change hands under the table frequently? It would elsewhere in the world, I have trouble believing US politicians are so honest as to not be on the take.
I do not. US bribery laws are among the most strict in the world (including relative to Europe) and prosecutions are common. Just last year a sitting US senator was tried for bribery charges (which ended in a mistrial because the jury couldn’t reach a unanimous verdict).
I somewhat agree with you. The US does have a great system in place, and I believe that in the US we're most likely to catch bribery when it occurs, if not close. However, the fact that catching bribery is common means that bribery is even more common than that. You just can't get around the fact that politicians are people and people are vulnerable to bribery.
Doesn’t need to. Campaign finance is legal and crazy cheap for the outcomes achieved. Typically tens of thousands to get millions or billions in breaks and pork.
That’s a self-defeating assertion. If legal campaign donations were so high return, more companies would make them, driving up the price. You’re presupposing the existence of this enormous arbitrage opportunity that nobody is talking advantage of, because...?
Shit, I can swing “tens of thousands.” Can you tell me how to get “millions” in pork? Shouldn’t YC companies just blow the $120,000 they get in campaign contributions?
Sure they do. You also need connected lobbists who understand how things work (which costs money), but the kickbacks ultimately are clearly worth it or they wouldn’t do it. American democracy is bought and sold to the highest bidder — the high end lobbists usually even write the bills that get voted on [1]!
Look how little Koch brothers pay to discredit most scientists and majorly influence the direction of this country:
Your post suffers from major cognitive dissonance. The economy “is bought and sold to the highest bidder”—but the bids are so low! Total lobbying expenditures is under $3 billion per year, equivalent to just 48 minutes of annual US corporate profits. If lobbying results in such high returns, why do the Koch brothers have to spend so little money to get results? It’s not like there aren’t folks with money in the other side of those issues: certainly, plenty of folks who can spend a few million here and there.
Think about it: Top lobbying firms pull in under $50 million a year in revenue. If they were really controlling access to billions in government pork and favors, shouldn’t they be able to charge a lot more?
Not opinion — go look on any database of campaign contributions and see the dollar amounts from biggies like Google, Exxon, Koch brothers, Disney, Coca-Cola, etc.
So you’re saying that it would’ve taken just $800,001 to block that copyright extension? Because whoever challenged it in the Supreme Court likely spent more than that in just legal fees doing so.
> Groups of people or interest groups should be allowed to bring their case to legislators to try to convince them.
Why can’t this be a public process with no direct access to the legislator ?
If the point is to change a public body’s behavior, it should be done in the open and with tracability. For me by definition it shouldn’t be lobbying but open discourse.
I don't know about the US, but in the EU Parliament, lobbyists need to be registered and I think all their meetings with legislators are part of the public record (maybe not the content, but the fact?).
Not necessarily personally - all sorts of exchanges here should be banned, including contributions to the election campaigns, which in true democracy should be funded solely from public money. Being allowed to bring the case does not mean that you have to or should be allowed to pay for that.
In this theoretical democracy with publicly funded elections would I, a completely independent citizen be able to buy ads in support of my desired candidate? How about making lawn signs to campaign? Or even just going door to door for him or her? All of the above is a gift of either my time or my money. Should all of that be banned? It's the problem people face when opposing Citizen's United. Money is inherently connected to speech.
> But in the course of the argument, Justice Samuel Alito interrupted Stewart and inquired: "What's your answer to [the] point that there isn't any constitutional difference between the distribution of this movie on video [on] demand and providing access on the internet, providing DVDs, either through a commercial service or maybe in a public library, [or] providing the same thing in a book? Would the Constitution permit the restriction of all of those as well?" Stewart, an experienced litigator who had represented the government in campaign-finance cases at the Supreme Court before, responded that the provisions of McCain-Feingold could in fact be constitutionally applied to limit all those forms of speech. The law, he contended, would even require banning a book that made the same points as the Citizens United video.
> There was an audible gasp in the courtroom. Then Justice Alito spoke, it seemed, for the entire audience: "That's pretty incredible."
Very interesting read. Thank you for linking it. It has significantly altered my perception of the Citizens United issue. I see now that there's no simple way to balance campaign finance reform against freedom of speech.
Edit: Perhaps instead of focusing on campaign finance reform, we should focus on polling reform, and expanding the house? If we used a better polling system, e.g. candidate ranking, and increased the number of representatives, then it would be much more costly to buy a majority.
Big money will remain in politics as long as there is big money in politics. That is, USA federal government spends many billions of dollars every day. Lots of people have noticed, and invested accordingly in political influence. The only way to change this is to spend much less. One option for that would be to break up the union into many smaller units who would levy taxes and spend money independently. It wouldn't be such a prize to serve as e.g. chairman of the senate finance committee in such a government, so there would be far less money involved in elections for that position.
Money might be connected to speech, but that doesn't make it an moral equivalent or practically inseparable. Time is a significantly more egalitarian resource than money. Without their money to leverage other people's time, a rich person has the same 24 hours in their day as a poor person. Sure, a poor person might be working two jobs, have to do all of their own shopping, cleaning, child caring, and elder caring, but a rich person doesn't have thousands, millions, or billions more hours than they need every day to satisfy their basic needs.
I don't think it's controversial to say that if you equate money to speech in the political process, then rich people (and non-people entities) will always have more speech. By my reckoning, such a system favors creating laws which favor the existing rich, which gives them even more speech to protect and entrench themselves. If I was designing a societal feedback loop to create an oligarchy, it would look like that. If you look at American post-war anti-socialist propaganda from sources like the National Education Program, a large part of their assertion that American capitalism is morally just is our system's wide distribution of wealth. The situation has changed significantly since then. I believe equating money to political speech will accelerate that change.
Fortunately we have a really great way for people to directly express their opinion about who should be elected: a vote.
But rich people can buy others' time. Pay-for-play aside, that's arguably that's what lobbying is in the first place. You pay other people to research, write position papers, have meetings, and persuade for you.
I live in AZ and that bill does nothing to stop outside spending. AFAIK, it also doesn’t cap what can be raised. If it does then most politicians here don’t access it.
How do you stop thousands of people from cramming the ballot just to have a little fun at the taxpayer expense? There has to be some qualification process which will cost money to complete.
There is no such thing as "public money." There is only money that the government has taken from people via taxes. So, if the government takes money from me, under threat of force, and then spends it on a candidate with whose views I disagree, it has forced me to support a candidate that I do not want elected.
To agree and rephrase, "public funding" looks like incumbents controlling how campaigns are funded and how those funds are spent. Add that on top of the existing gerrymandering issues and it sounds like we'll have a government even less accountable to the average voter.
Isn't funding election campaigns from public money a quick and sure route to totalitarianism? I'll say the opposite - any kind of public money involvement into elections should be banned.
Don't get fooled with 'democracy' thing. Election and democratic process are the way for the elites to decide matters between themselves without resorting to civil wars/violence, in an orderly, regulated manner. They were invented for that purpose in the middle ages England which got tired of civil wars and serve that purpose perfectly.
'Opinions' of ordinary people are not important because they effectively, don't exist: propaganda decides what their opinions will be.
> Don't get fooled with 'democracy' thing. Election and democratic process are the way for the elites to decide matters between themselves without resorting to civil wars/violence, in an orderly, regulated manner. They were invented for that purpose in the middle ages England which got tired of civil wars and serve that purpose perfectly.
That’s a fascinating thesis, can you point me to sources on it?
Funding campaings from public money is widespread in Europe. Sometimes the opposite argument is made: public funding ensures a level field, in which no one has a disproportionate advantage. Of course, this has the effect of displacing the battle to the real battlefields, one of them being propaganda, as you said.
Democrats and Republicans already control ballot access laws, a clear conflict of interest. Let us wave our magic wands and — poof! — campaign expenditures are now tax-funded. Nothing meaningful changes. The Republicrats still control who has access to the ballot and thus who will receive campaign largess.
“Public campaign finance” is no magic fix, rather it is welfare for already wealthy political parties.
If campaign financing will be restricted to public money, they won't be wealthy anymore and they will not be able to use to their political benefit any unrestricted hidden wealth in the form of super PACs. And this will also open way for the smaller parties and independent candidates to the fair competition.
If politicians are denied chance to get silently wealthy on their positions, we will have different kind of politicians: not relatively benign fat cats who are after nothing but money, but ideologically explosive 'great leaders' who want to change the world in the name of their 'great' ideas (there won't be much reason to go into politics otherwise, if you can't make much cash there). Do you really want any of them?
Corruptioners are the best kinds of politicians you may have.
Well, I already have plenty of politicians representing me as a result of recent elections, and they belong to neither of the kind, as far as I know. Here in Germany we probably have few fat cats, but the 'great leaders' are political marginals. The politics are done by parties, which leadership periodically changes, and the government isn't run by a single person able to impose their will on other ministers.
And people whose only jobs as adults have been elected or appointed positions will still mysteriously become worth 7 or 8 or 9 figures by the end of their careers, even though their only reported income has been a government salary.
>"Don't get fooled with 'democracy' thing. Election and democratic process are the way for the elites to decide matters between themselves without resorting to civil wars/violence, in an orderly, regulated manner. They were invented for that purpose in the middle ages England"
Democracy was most certainly not invented in the middle ages or in England. Neither of those statements is even remotely true. Democracy is a product of Ancient Greece around 300BC. And then the Romans after that. See:
The ancient Athenians would reject our form of democracy because they regarded popular elections as a tool of oligarchy. They also executed officials for abuse of power.
>Isn't funding election campaigns from public money a quick and sure route to totalitarianism?
There's no causal link between public funding and totalitarianism and there's no historical proof that this ever happened.
When and if democracy fails, it happens for a number of other reasons, but this is certainly more likely to happen, when a) there's no equality in voter's influence on the outcome, b) there's no fair competition between candidates.
Public funding usually addresses those two problems and at this moment does it quite successfully in Europe, which, despite all the recent turbulence and the rise of the far-right parties, is still in much better shape than USA, when it comes to the elections.
Nobody in the US is going to get behind banning me, an independent citizen, from making Bernie Sanders bumper-stickers or yard-signs. Nor me making TV ads about how great Bernie would be for our country.
Your proposal is at complete odds with the US Constitution with respect to an individual's right to free speech. Lobbying creates a paper trail of sorts and is therefore more transparent (How do you think opensecrets exists?).
Freedom of speech is just one of the many freedoms granted by the rule of law, it's not a law of nature and not something unquestionable in any circumstances. There are always limits to it, even in the US constitution itself (which is quite outdated document, as we already know from the mass shootings made possible by it). Limits can and should be imposed to defend the sane way to elect the government, but of course it's up to you, American people, which way do you want to go. I just hope that you'll finally sort this out somehow, because the world cannot let America being a self-proclaimed "leader of free world" ruled by Trump-like oligarchy.
You are mistaking citizen action and corporate lobbying, especially the way it's done in the US. It's always Big Companies, with vested interests in keeping the statue quo, because their CEOs lack the creativity to move forward and has the shareholder have no incentive to ask him to do otherwise, spend millions of dollars, target to specific senator or house representatives whose votes will help and only help the big co...
We are not talking about what your friend did, or what you are supporting. Those are actions that will move the society forward.
There isn't a check box on the LLC form that says all your actions from now on must be evil. There are going to be citizen interest groups you disagree with and corporations you agree with. And a lot of high-profile lobbying is corporations arguing against each other.
If there was a simple heuristic like whatever corporations want is bad and whatever individuals want is good, then governing wouldn't be hard. Policy would be easy and not full of complex dilemmas with multiple competing interest groups that all have roughly prima facie coherent perspectives and interests.
Some of these groups will of course be wrong on further examination, but sorting that out isn't some one line test.
Big companies don’t need lobbyists to influence government. Environmental organizations do.
Look at Amazon. They put out bids for a place to build HQ2, and states fall over themselves to accommodate them. Corporate donations to candidates are already illegal. It doesn’t matter—the CEO of a big employer can just call up a Congressman and say “hey, I employ 10,000 constituents in your district. It’d be a shame if anything happened to their jobs.”
There was a point in the 90s when tech companies weren't interested in politics so much. They mostly tried to be better at technology and business and stay out of that game.
Things like anti-trust suits, vague IP law, and ___domain name disputes disabused tech companies of that notion quickly. They couldn't afford not to get involved in lobbying.
In US you can legally “donate” to politicians and have meetings with them without much tracebility.
Then you also have the dumb idea of super delegates, to which millions are donated by corporations since they have a much larger influence than individual voters.
The reality is that US is no longer a democracy, it’s a plutocracy where the wealthy have a far larger influence.
And since elections are getting more expensive every term, I predict almost every candidate to be a billionaire backed candidate. Bernie was an exception but couldn’t do much against billionaire backed Hillary.
That touches upon the fundamental problem of end justifying means... And in the case of lobbying the groups of interest that will prevade will be the ones with the biggest amount of cash in their pockets, which doesn't correlate often with the best ethics.
>Groups of people or interest groups should be allowed to bring their case to legislators to try to convince them.
Why should YOU or you and your friends be allowed to lobby MY congressman if you're not in a district he or she represents? They're in office to represent their constituents, not whoever has the most money to throw their way. Lobbying should be limited to constituents only, not include gifts, donations, or further benefits post-office.
That's not how the law works, and it's definitely not how lobbying works. Which is exactly why it's broken. And quite frankly even if there were "members" in my district, those members should be contacting their representative(s) themselves.
Of course lobbying is a problem. How different is it from bribery? Some senator receiving money from a company or person in a exchange for a benefit. It always baffles me it is legal in USA (and probably other countries?).
What you described sounds like a citizen lobbying effort and that type of lobbying is indeed an essential part of a democracy.
However I think a distinction must be made between citizen and petition lobbying and and the big-moneyed-corporate special-interest lobbying. When people are decrying the general term "lobbying" its mostly the latter.
Perhaps read the hyphenated adjective "big-moneyed" that precedes the term special-interest in my comment. The NRA, Planned Parenthood and the AFL-CIO all make 10's of millions of dollars in direct campaign contributions[1][2][3].
This is not at all the same as what the framers had in mind with the right to “petition the government for redress of grievances” in the First Amendment. Big-moneyed special interest and influence was specifically something that James Madison was concerned about. I recommend reading "The Federalist Papers."
The US government doesn't represent the people. It only represents about 10% of the people; those who are the top income earners and whose view happen to align with the interests that represent the top industry groups.
I've read the study referenced in the video, specifically the Gilens and Page, "Testing Theories of American Politics: Elites, Interest Groups, and Average Citizens" published in 2014.
It's a really good study and worth reading. I've used the same study in a video I later made:
The problem with the Gilens and Page study is that it shows the elites and regular people agree about 90% of policies: https://www.vox.com/2016/5/9/11502464/gilens-page-oligarchy-.... They look at the situations where the elite and regular people disagree, and conclude that because the rich win those areas of disagreement, we live in an “oligarchy.” But it does almost no analysis of those issues. Without that analysis, it’s hard to tell whether that’s oligarchy, or just republican democracy doing the “republican” part. The paper also makes the huge mistake of using survey data without systematically accounting for whether respondents are likely voters. It is well known that voters are not representative of the population as a whole. They skew older, whiter, and more conservative.
I have moved to the US very recently. I have actually filled my 2017 French revenue form today.
It took me 10 minutes and that's because I had to find how much I had paid home cleaning services (home employment is deductible), it could have been done in 2.
Even after paying 180 dollars to HRBlock, my US taxes were way less straightforward and took me hours.
The 2 jobs are comparable and should be just as easy to declare for.
I've always been under the impression that H&R block tax preparer are not very qualified employees who aren't regulated in any way, and don't have to really undergo any rigorous training.
It's worth ponying up a little extra for a CPA, or spending a little extra time reading the instructions on the tax forms and googling/asking online for answers.
I’m assuming your US taxes were more complicated than reporting W-2 income. My US taxes consist only of reporting one W-2 (or two when I change jobs), and don’t take more than 10 minutes. Most of that time is spent trying to figure out how and where to access the W-2 from my employer’s payroll provider.
True. You need to have charitable giving, etc., and make enough money that the standard deduction might not apply. It's generally a problem for people making enough money to buy their own home, etc.
No investment accounts that pay dividends, and in most years I haven't sold/liquidated any accounts. I did forget that I do submit a 1099-INT that my bank provides for the small amount of interest I earn in one savings account.
No retirement accounts other than my 401k. I'm under the impression that there are no tax implications until I retire and start withdrawing (because my contributions are already deducted from my taxable income on my W-2 form).
No hobby or self-employment income. No charitable giving or other deductions that I consider worth the trouble of filing.
If you have to file in France and the US she/he probably needs to file 1040 and 1116. And if you live outside the US you can't file online. Because the US is decades behind in this stuff.
I had to check a box saying that I don't own a TV (so I don't have to pay that tax)
I also had to connect to my home cleaning service website in order to know exactly how much I paid them in 2017.
That's pretty much it, everything else was already filled.
Since my employer has declared that I worked for them (I mean .. that's the case for most people except black market), the FISC (french IRS) already knows how much I made that year.
If you are freelancing, or another regime different from full time job in a company, it might be more complicated.
but for 90% of the people, you connect to the gov website, approve your taxes and that's it.
US has federal and state taxes. Both are obscure. AFAIK, there is no government website to do your taxes. No prefilling either of course.
So I had to google a lot, look for my w2, etc.
I used hr block since it looked easier than figuring out everything myself.
It was still more of an headache than my french taxes and I don't think that it was only because of my expat status.
> there is no government website to do your taxes.
i was curious about your comment
> Even after paying 180 dollars to HRBlock, my US taxes were way less straightforward and took me hours.
I used turbotax for both state and federal it imported and prefilled my adp w2 and imported my tax account from etrade.com. It took me 10 minutes to finish it.
To sum it up better : you don't need turbotax at all in France.
http://www.impots.gouv.fr/ . (it would be taxes.gov.us here ) already has all the prefill that all these services have.
I guess it can always be argued that maybe corporations are more cost effective than a government.
We would need to compare the figures though, in France corporations don't spend millions bribing the government in order to do abandon the idea of improving the tax system.
I think we need to distinguish between "lobbying", which is basically just talking to politicians, and campaign funding which is so close to legalised bribery.
The big question is "why does America seem to have no effective consumer lobbying groups"?
That's not a big question, the US does have a lot of large, effective consumer lobbying groups. Most of the consumer protections and product labeling the US has, is thanks to them, going back more than a century. The US has a consumer lobbying group for pretty much every topic and demographic you can name.
"NRA receives 350M/yr in 2014"
"NRA has received, in total, 80M from individual donors in the past 13 years"
"NRA received 22M from individual donors in 2014"
22M of 350M revenue means that individual donors are very small.
Where does the other 330M per year come from, if not individual donors?
The NRA (I’m a member, and my wife) has at > 4M members. It’s $30/year, so that is $120M/year just in membership fees. You are only counting donations, which are separate.
Suggest you read John Lott to see how the media and manipulates gun statistics.
We’ve got effective consumer lobbying groups. E.g. we’ve got crazy safety standards for cars that make them heavier and inefficient (compared to lighter vehicles in Europe?)
Are those really from consumer lobbying groups or astroturf? I remember Ralph Nader ran into serious opposition trying to get seatbelts adopted, but that was decades ago.
Astroturf from who? Europe shows that car manufacturers wouldn’t overengineer cars for safety if they didn’t have to. Who else would be responsible for it if not consumer groups?
Lobbying is an excellent way for small groups to be heard in political corridors. Lobbying happens in any large democracy and when it is illegal it often happens through backdoors creating a chain of unimaginable corruption.
It is much better for Intuit and HR Block to openly lobby for complex tax code rather than paying bribes through backdoor.
Secondly, why are people re-electing the politicians who suck up to Intuit then ? It is because people do not care as much.
>Secondly, why are people re-electing the politicians who suck up to Intuit then ?
In US you have less choices AFAIK, just seen yesterday that one party owns a big TV network and some HNer commented that the other party should also buy a similar big network, there is no consideration that maybe there should me more then 2 choices, from what I see from outside US is that it is impossible to have a 3rd or 4rd option so you have to chose between 2 bad options each cycle.
If I am wrong please correct me, again this is how the things appear from us outside US (I never heard of a 3rd party or 3rd president candidate with a real chance)
In the U.S., the major parties compete with each other. Over the decades, what they actually do varies a lot. As one party has success generally or on particular issues, the other party will adjust to attract voters.
Positions held by (relatively) successful third parties are quickly absorbed to some degree by one major party or both.
The net result is a weird mishmash of positions on either side of the aisle that no individual would actually choose. It also means disproportionate benefits for things that intensely benefit small portions of the population with mild downsides for the rest.
Despite all the concern, the national legislature has been fairly evenly divided over the last 25 years or so, giving control back and forth. This is even more true of the presidency. It's exceptional that a party will hold the presidency for more than two terms of office.
All that being said, I do think there could be some national consensus about things with little more explicit horse-trading. I could see a carbon tax passing, for instance, if it were attached to a bill requiring a balanced budget. But no major party could propose something like that without angering its base.
In the U.S. the two major parties work to keep third parties off the ballot and to create rules making it difficult for them to succeed.
I can't cite chapter and verse, but I've seen stories about third parties being sued over every possible ballot application technicality, being excluded from debates, etc.
It's worth keeping in mind that the party system works differently in the US than it does in most other countries. Almost anyone can up and announce they're running as a Republican or a Democrat regardless of their prior actions or current beliefs, and vote however they want with few consequences.
Consider that Bernie Sanders was a member of a third party as a senator, but ran as a democrat for president without changing any of his positions. Similarly, Trump had little relation to the modern Republican party and essentially took it over anyway. When Ron Paul, Donald Trump, and John McCain are all in the same party, you're talking about a pretty big tent.
In the USA, "parties" are more analogous to coalitions in parliamentary democracies. The party primaries play a tremendous and oft-overlooked role in the actual elections.
Can you explain why do you think the following is not happening in US:
A new party is created, as an example, a green party, that is all for green energy, ecology, privacy (just an example)
This party could grab 10% then if the other 2 parties are balanced, they would have around 45% each, then the major parties would need support from the small party to pass some laws, for this support the green party would get back some of their ideas implemented.
Are there laws or money that block such thing to happen?
> Are there laws or money that block such thing to happen?
There are no laws backing it, and in fact the Green Party and many other parties do exist in the US. Some make it to Congress. The Presidential ballot is usually filled with a variety of different parties. State legislatures and even the federal legislature often have a little more variety. The smaller parties choose to caucus with the larger ones in what Europeans would call a coalition.
There are two political reasons it doesn't happen. Most people focus on the winner-take-all aspect of (some) final elections. This is a little misleading since not all elections are one round of winner-take-all in the first place), and almost all elections have at least a primary beforehand, making it minimally something at least akin to two-round voting.
The other reason is there's no need to. There is extremely little intra-party policing. I (I have actually done this, though I lost) can right now, make this my platform and file my paperwork to run as a Republican or a Democrat. I get the immediate benefit of all the massive party machinery in the general election if I win the primary election. When I win my election, I can push my issues to my hearts content, and by working with my nominal party, I am likely to get at least some minor legislative or executive wins. The more successful I am the more I will shift the politics of the entire party, especially if my platform proves popular with voters - more politicians in my "party" will take up my cause to help their own.
How do I choose which party? Well, I choose the party I think is more likely to work with me. I can, at any time, even after assuming office, switch parties and choose to caucus with someone else if I think I will be more successful that way. This happens more often thank you'd think.
The US doesn't have a ton of parties at the federal level because the two "parties" are really already representative of two broad coalitions in practice. You only see a third party rise en-masse during times of huge, sudden political re-alignments where the old coalition falls apart and a new one has to be formed. Even during "normal" times, though, you certainly have a lot of politicking based on the "real" parties within the coalition, and groups within the Republican or Democratic parties in Congress go vote with another group that aligns more with their interests. For example, the Republican party is a mix of libertarians, neoconservatives, Chamber of Commerce Republicans, Trump Republicans, and others. The Democratic party is a mix of environmentalists, social justice advocates, Chamber of Commerce Democrats, warhawks, Blue Dogs, the CBC, pro-labor folks, neoliberals, etc. It's a very messy picture and votes don't necessarily fall along coalition lines. Often, for example, the Blue Dog Democrats vote with Republicans, and Trump Republicans and pro-labor Democrats have some commonalities where they vote together. There's no rule requiring members to vote with their party, so they do as they like. If you flout the majority of the party often enough you might lose your shot at a a sweet committee assignment, but if you don't flout your party you might very well lose your election. Generally, the party will recognize when you can't vote with them due to your constituency and be perfectly ok with it.
Thanks for explaining this, here in Romania is different probably because the new democratic system is young, some characteristics that I noticed are:
- big parties will split if there are 2 wings inside (it could be some inner fight for power too)
- 2 parties will also completely merge (not just for a coalition) and make a new party , this probably happens if the parties are small
- parties can win an election, perform bad afterwards, gets few votes, then disappears, splits, merge
- the leader of the party has a big importance, his charisma can help or be the doom of a party, sometimes you get a big egomaniac in charge of a party and the idot does a lot of damage to that party
Btw I am not saying a system is better then other, I hate the politics, you see them criticizing a good idea just because is from the other side when they would probably would have done the same, you see valid corruption accusation named as political attacks (we have a big corruption problem here, the justice is moving in the right direction but the politicians are struggling to fight it)
So ? Are you saying people or group should not be allowed to influence government decision making ?
Do you want your government to do X ?
X => Ban Guns/Allow people to bear arms
X => Make abortions simple/Ban abortions totally
X => Enforce net neutrality/ Let markets handle it
Every person will always have a stand on this issue and will try all in his power to influence the government. Would you rather want it to be legal and open or underground black market is the question.
I will vote in the election in
November. In each race, I will have (if I’m lucky) a choice between a couple of people who will only get a tiny percentage of the vote, a person from the party who thinks Donald Trump should hold the presidency, and one other person who might possibly win instead of that one.
My choice is all but predetermined. The question of which ones suck up to Intuit basically doesn’t come into it.
In practice, many Americans don’t have to do much more work than that. If you work for an employer that uses a major payroll system, tax prep software can often directly import your paycheck information and for the most part you’re done.
The big problems with US tax preparation seem truly hard to solve. A huge number of Americans take deductions which are fundamentally hard to automatically report. It would be hard for every charity to talk to every tax authority. Another trouble is that tax laws at federal, state and local levels are weirdly different and sometimes incompatible.
The latest federal tax law eliminates the use of itemized deductions for about 90% of tax payers, however. This may nudge us closer to prefiled taxes.
> If you work for an employer that uses a major payroll system, tax prep software can often directly import your paycheck information and for the most part you’re done.
The only tax preparers that do this charge quite a bit if your AGI is above a certain amount. The others make you do manual data entry. If you have a brokerage account with a lot of trades, it's over — you pretty much need to use a tax preparer that can import that information.
This is true even though the government already has that information from your employer and your brokerage. In GP's country, he doesn't have to do anything at all in these cases.
It would be hard for every charity to talk to every tax authority.
Every payer files 1099s and sends the payee a copy. It would be no hardship for charities to file analogous forms and send analogous copies to donors, although I suppose the chance of false filing would increase. To prevent that, just issue charities some secret identifier they write on the form that goes to IRS and don't write on the copy they send to the payer.
Let's say you want to build a road (to nowhere really) in Mississippi. Your company builds roads and you are pretty damn sure you will win the contract if it happens. You want Senator Cindy Hyde Smith to ear mark some federal cash for the project (s). How much would it cost? Answer: not much. She only has 200k of cash on hand. If you donate $50K you got a new best friend. If you give her 2k, you will probably land a dinner.
I've heard (so this is a weak second hand story) that here in the Netherlands we also have a lot of lobbying, but the less strict laws around campaign financing make it less evident.
I'm not sure if it's true, but it's something to think about.
At the very least, it suggests that the strong laws on campaign financing in the US help pull lobbying into the light.
>Lobbying is a way for the rich to legally shortcircuit democracy. It’s legal corruption and as bad for democracy as the illegal counterpart.
Lobbying is the lifeblood of American democracy, and the system was expressly designed for it, so its a little odd hearing you instead posit that it’s actually not.
Maybe you’re thinking of modern campaign financing?
Lobbying / lobbyist are nothing more than a polite euphemism for influence and corruption.
I think it's worth adding that non pre-filled (i.e., the status quo) is also in the IRS's best interest. A person's mistake(s) allow for fines, interest, etc. The policing + enforcement also increases the IRS's head count. Layoffs by the fed gov never play well politically; to say nothing of lawyer and/or accountant fees incurred by the accused.
Bottom line: Everyone wins, except for the average American citizen. He / she is screwed. Again.
Reminds me of the similar article posted recently, '“Is curing patients a sustainable business model?” Goldman Sachs analysts ask.' Or net neutrality. Regulatory capture is out of control in at least a dozen american industries i know of.
I've read a thread like this before, prepare for lots of people from countries that aren't the US explaining that their taxes are way simpler.
I wouldn't be surprised if a significant part of the GDP of the US comes from rent-seeking "services" that are either not needed or overcharged. Like "credit protection" for "identity theft". Healthcare seems to be the main contributor to this.
This is a really important issue that I’ve never seen addressed well...
We measure numbers that are easy to measure, like GDP or GDP PPP according to some basket, or unemployment rate.
But how much of it is real?
We have a ~18t GDP, but how much is actual productivity vs rent seeking?
We’re at 4% “unemployment”, but how many people have busywork jobs that don’t fundamentally need to be done? How many have crappy jobs / bad bosses / no security/ need a second or third job to make rent?
Without digging deeper, I think the top line numbers are misleading and lead to optimizing the wrong things.
I think the things we care about most are the things we aren’t measuring yet.
Governments across the world are becoming more proactive and trying to improve ease of doing business and paying taxes. This is the way it should be. Citizens shouldn't have to run around or pay someone to pay taxes. In India, starting a business used to be a hassle taking more than 2 - 3 months, now they have completely made it online and free. So players in India like https://www.indiafilings.com are also adopting to the changes by providing more services or lowering the fee, which is great for Entrepreneurs. Hopefully, the politicians will not budge for lobbying to satisfy a few corporates and look at the bigger picture.
Am I disappointed? Yes. Am I surprised? Absolutely not. They truly fear for the safety of their industry, which is responsible for ~$7.5B in revenue between the two (per annum).
In Germany, many people don’t need to file taxes, as they’re deducted anyways. But you can and it usually saves you some money. If you do though, it’s about as complex as in the states, the only difference being that there is only one form you’d need to fill and not 2-3 (federal, state, city)
This is true for employees without additional income on the side. If you have this, you are obligated to file and have a tighter deadline.
Also, the set of forms is a monster. There is a simple-looking main form with four pages, but you usually need two or three of the appendix forms as well (there are ~10 different appendices, some of which can be required multiple times). This still hides the true complexity of German tax law. Almost every field in every form has a stupidly long list of rules and exceptions attached.
Even as a single and empolyee, I need to fill out a few appendices (or rather my tax advisor does) plus a big set of of copies of proofs for the data in the forms (usually between 20 and 40 pages).
My impression is that "US taxes are complicated" arises from the fact that they have such a wide variety of possible tax deductions and tax credits, each with complicated conditions and rates. For medical expenses, moving expenses, training expenses, for various personal purchases that you use for work, for solar water heaters, and so on.
If you earned salary from one employer and used only a few standard deductions, then filing US taxes should be easy as well.
I’m a Canadian who has filed taxes in Canada (file like the US, but it’s simpler), the UK (no filing necessary if you only have interest and employment income) and the US.
One of the other complications with US taxes is that payroll systems and the exemption formula make it hard to get your deductions exactly right (this happens in Canada too), because you have to be able to exactly predict your annual income. In the UK the “Pay As You Earn” system deducts exactly what’s needed as you earn it. Even interest payments from the bank will have a line item for withheld taxes.
How do different entities determine your current tax rate for correct withholding? Say your interest payments from the bank — does the bank consult the tax authority to determine the correct rate? Similarly, how does it work if you have two employers?
Second, in a graduated income tax system, this would result in decreasing take-home pay over the course of the year. Does that not cause some confusion/strife? Seems like plenty of people struggle to budget beyond paycheck-to-paycheck as it is (in the US).
EU country: My employer reports my salary and already paid my taxes for me, deducted from my pay check.
All banks report what I paid in interests on my loans and how much interest I got paid on my savings accounts. They also report what profits I made from funds and whether I sold any at a profit (in which case they deducted and paid the tax on those profits).
The rates are fixed for most kinds of income that entities other than employers are concerned with. So a bank can deduct the dividends tax easily. Tax brackets for salary taxes exist, but so long as you have one employer only, and don't suddenly get a massive pay hike/cut, they will know your yearly income and can deduct given the correct bracket. There is no decrease in take-home pay and no confusion (I honestly didn't quite understand where the confusion would arise?)
If too much or too little has been paid for the whole year, that's simply mentioned at the bottom line of your prefilled online tax return form.
> Tax brackets for salary taxes exist, but so long as you have one employer only, and don't suddenly get a massive pay hike/cut, they will know your yearly income and can deduct given the correct bracket. There is no decrease in take-home pay and no confusion (I honestly didn't quite understand where the confusion would arise?)
That's pretty much identical to US withholding. As long as your employer can easily predict your annual wage income, that part is withheld basically correctly. If you change jobs or experience an unusual bonus or hold multiple jobs, good luck.
> If too much or too little has been paid for the whole year, that's simply mentioned at the bottom line of your prefilled online tax return form.
Yeah, that's similar to the US, except the prefilled form isn't always online and is called a W-2. It is copied into the actual filed 1040 document and withholding is credited against your taxes owed.
The grandparent post claimed: "One of the other complications with US taxes is that payroll systems and the exemption formula make it hard to get your deductions exactly right (this happens in Canada too), because you have to be able to exactly predict your annual income. In the UK the “Pay As You Earn” system deducts exactly what’s needed as you earn it." (My emphasis added.)
That comment (and the name) suggests that — unlike the US — the UK withholds at the rate of your exact current tax bracket. If that's true (perhaps I am misreading it), your take-home pay would decrease as your tax rate increases over the year, assuming your gross pay is split evenly across pay statements.
That does seem confusing (unless the gp was formulated incorrectly). Most tax systems have some progressivity such as a large base deduction which could effectively make your first salary tax free and quite possibly make the last one of the year be taxed at over 50%. It would be confusing to say the least. I'm guessing the GP was just poorly formulated and that doesn't happen and "exactly what's needed as you earn it" is still involving at least a multiplication with 12 as the prediction for yearly income from monthly salary.
>Same in the UK. I think it's probably like that in most countries.
I can confirm for Italy, it is the same, for very, very simple situations (employee or retired) the government provides a pre-filled tax form, with the addition, since a couple years that some (not always correct though, yet) medical expenses (that can be subtracted) are already filled in.
As soon as you have some other source of income (or some extraordinary expenses) you actually need an accountant/consultant.
IMO the problem is the tax code itself rather than who is filing the paperwork. Unless that is simplified, there is zero chance the average citizen can work through their taxes themselves and pay the correct amount.
I'm always puzzled when average people argue that taxes are too confusing. It seems to me like people make it out to be a much larger burden than it actually is. If all you have is a W2, and deductions less than the standard deduction (which is what I'd argue is average), then you can fill out a 1040 by yourself in 30 minutes or less. Even faster if you use some of the software solutions out there.
Nothing can be done about open corruption like this until money is taken out of politics. Since the Supreme Court has ruled that this can’t be done by banning donations or limiting political advertising, the solution is to reduce the size of each electorate so that politicians don’t need to raise truckloads of cash in order to run.
If there were only 20,000 voters in each district then people would be able to run (and win) on personally meeting all the voters. No need for advertising and the money this requires. If you got rid off all the political staff then it wouldn’t even cost anymore.
> Sen. Elizabeth Warren, D-Mass., offered a bill last year that would have actually allowed the government to start offering prefill tax returns.
Ironically, just last year, Massachusetts got rid of its own simple, free online tool for filing state taxes, and instead directs residents to commercial offerings.
It’s annoying to see this pop up every year. H&R Block and Intuit aren’t somehow blocking tax reform that would simplify filing for all the other huge companies that do taxes. That’s an absurd theory. They’re lobbying to support something that’ll happen anyway because a huge bloc wants people to be outraged every April 15 when they do their taxes.
And you know what? It works! Every year I write a check to pay our marriage penalty and fume about how it. I think it’s responsible for why middle and lower income Americans feel like they’re over taxed (even though they pay much less taxes than in europe).
> And you know what? It works! Every year I write a check to pay our marriage penalty and fume about how it.
FWIW, the marriage penalty almost completely disappears in the 2018 tax reforms. There is still a higher rate for very high earning couples than for very high earning singles, and some deductions are not doubled for couples, but most of the tax brackets now line up as exactly double the single bracket (up to the 32% bracket). This markedly closer than prior years.
For those interested in the theory of lobbying and special interest groups one of my favorite books is Mancur Olson's Rise and Decline of Nations (https://www.amazon.com/Rise-Decline-Nations-Stagflation-Rigi...). It's an incredibly approachable read that does a wonderful job digging into the incentives and explains why lobbying exists and why it works.
I might be alone here but in high school we had a single class to teach us money management and how to file taxes ourselves. It’s only complicated if you have complicated situations. Vast majority of people probably shouldn’t be using software anyways but the marketing makes them think they’ll get a bigger refund.
I also wouldn’t have a problem with them getting rid of all the weird rules around certain deductions. Example, is web hosting a utility or subscription service?
The legitimate side to this is that people should know what their government is costing them. Because of tax withholding, many people don’t even realize how high/low their taxes are.
I have a belief that we should get rid of tax-withholding, and have people just write a big check (or receive a EITC check) for all of their taxes at the end of the year.
To me (and I think many republicans), hiding the taxes you pay with withholding is really pretty slimy.
It’s hardly hidden. Withholding is clearly listed on each pay stub. It’s true that people often don’t pay attention, but that’s not at all the same thing as hiding it.
If you ended withholding, tons of people would spend too much during the year, not have enough saved to pay their taxes, and get into serious trouble. It would be the mirror of how so many idiots are giddy about their refund each April, except instead of feeling like they got a windfall, they’d end up with massive penalties.
You could argue that it’s their own fault and they should be more responsible. I’d agree that they should, but they won’t, any more than they’ll be responsible enough to read their pay stubs and understand their withholding.
I realize totally insane, but, I think we should end withholdings. I think people should at the end of the year - cut a huge check to the government. Also, you should be given a Scranton with government institutions listed -- YOU pick where your money goes.
Every year a week before the tax deadline, this exact topic pops up. I've noticed now for the past 4 to 5 years.
The IRS should really advocate for this since it makes their jobs easier due to people making less mistakes. The IRS also has it's own lobby group - the US Congress. It's just not good at lobbying for the IRS...or Americans.
I have found a free spreadsheet online,and I mail a paper return. The spreadsheet is surprisingly good, and I can use it in libreoffice. I started doing that after finding $22,000 worth of errors in years past. I call it paper protest.
Tax companies whose existence relies on them and only them to decipher cryptic government tax laws. Quite literally the most predictable and unsurprising news article to come out on the internet.
Don't hate the player? Lobbyism doesn't serve the public, but it is how American law-making is done. Of course companies will lobby to keep their business.
That’s apologism for a despicable practice. Hate the player and hate the game because we’re all getting played in systems where lobbying is legal. This is how politicians end up serving corporations instead of people.
My point is that you can't blame companies for protecting their business. Their boards wouldn't be doing their jobs if they didn't.
The system where money translates into such disproportionate control over the law is broken. Two cultural aspects in America are also factors: 1. Corporations are in many aspects viewed as persons (e.g. they're afforded human rights such as freedom of speech), and 2. half of the voting population doesn't vote.
Oh, gotta outlaw all forms of political fund-raising too, then; apparently it's ok to give money to your neighbour unless that neighbour is running for office. Am I still allowed to spend my own money on an ad in the newspaper extolling the virtues of my preferred candidate?
The government already controls taxes and thus citizens’ incomes. In a time when so many are worried about privacy, few voice any concern about the enormous privacy problems inherent in the forced full disclosure of the intimate details of one’s financial affairs.
Fiscal year 2019 is forecast to have federal revenue of $3.422 trillion[0], of which $1.688 trillion will be from individual income taxes. That means repealing the income tax and replacing it with nothing would take the federal budget not back to the founding era or even the nineteenth century but to the Clinton years[1].
[0]: https://www.thebalance.com/current-u-s-federal-government-ta...
[1]: http://www.taxpolicycenter.org/statistics/federal-receipt-an...