You might not know that a nice man named Dave Camp tried to help you earlier this year. But he wasn’t allowed to.
Mr. Camp is a member of the House of Representatives, a Republican from Michigan. He is also the chairman of one of those committees that always has the word “powerful” in front of it – the Ways and Means Committee. It’s in charge of the tax code.
Camp has to give up his powerful chairman’s job this year because Republican’s put term limits on those jobs. As the crowning achievement of his career, Camp has been pushing legislation to simplify the tax code a little bit.
After that bill was introduced, Speaker John Boehner said it didn’t have a snowball’s chance in Hades. Pressed on some details of the bill, the Speaker simply said “blah, blah, blah.”
“Blah, blah, blah” is a very good way to describe how Congress after Congress and President after President have treated the harassed and miserable American taxpayer. And that’s charitable.
Here’s the really frustrating thing about the tax laws: There is virtually no substantive disagreement between the parties and amongst experts that a simpler tax code is better.
There is a nearly universal consensus the tax code is too complicated and that too much of the country’s treasure and brainpower is spent complying with the tax code – or outsmarting it, if you have the dough.
One reason the tax code got complicated was that Congress discovered a good way to give away treats was through tax breaks – for mortgages, home office expenses, oil wells, jojoba bean and a list of things it takes roughly 8,000 pages to describe. No economist in the world thinks that’s a good idea anymore. But every loophole or “tax expenditure” eventually gets its own lobbyists.
And every pol who has ever run for office knows that tax hassles sour people on the federal government like nothing else.
There are plenty of arguments about how big the tax burden should be, but that is really a debate about the size of government.
And there are plenty of arguments about how progressive taxes should be, about whether higher incomes should be taxed at higher rates.
But what about simplification? No argument, really. Tax lawyers and hedge funds excluded, nobody argues for a complicated tax code. Especially when it comes to families and not businesses. I’m not kidding, you can Google it.
Ponder some factoids:
- Of the 142 million returns filed last year, 79 million had to use paid tax preparers.
- The average taxpayer spends 13 hours a year on federal taxes; the average business, 23 hours.
- The total cost of complying with federal taxes is estimated at around $170 billion, roughly the size of the GDP of New Zealand.
- IRS.com lists 1,988 files on it “forms and publications” search results page.
- The IRS is able to answer only 61 per cent of the calls it receives for customer service assistance.
It is our greatest legal scandal.
And you know what your government thinks about your complaints?
Blah, blah, blah.