The irrelevance of tax reform

The Gov needs money. I’m as entertained as anyone else by speculations about how to improve the tax code. It certainly could be improved. But there is a much simpler way to increase collections — enforce the tax code we already have. About one in six dollars owed is not paid on time, or ever.  The solution is simple: give the over-burdened Internal Revenue Service more money. I wrote about this some years ago, but now as my twin brother The Dude says, new shit has come to light: a report from the Center on Budget and Policy Priorities.

Jared Bernstein elaborates here in the Washington Post, and the New York Times editorial page takes note.

One of my pet peeves is that in budget score-keeping, which is the process of estimating the impact of new legislation on the Federal budget deficit, extra spending on the IRS counts as an addition to the deficit, whereas there is little doubt that more money for enforcement would bring in more revenue and reduce the deficit. I brought this up with a couple of score-keepers once, and they said such estimation was too difficult to do for technical reasons. I don’t believe it.



The irrelevance of tax reform — 5 Comments

  1. As Congress is cutting the IRS budget and holding incessant hearings over the fake 501(c) “scandal”, the alleged A team they brought in to better the enforcement of the transfer pricing rules has just retired in mass. Multinationals that are engaged in income shifting to tax havens are likely having a party.

  2. The 501(c) thing was bullshit, from start to finish, down to its last molecule.

  3. IRS stands for Internal Revenue Service. So what’s “internal” got to do with this? I have lived, worked and paid taxes in Canada for the past 47 years. Last week I filed “delinquent” 1040s and FBARs for seven years so that I would be in compliance with IRS regulations that otherwise could impose confiscatory penalties on financial assets on which I owed no taxes. My “delinquent” tax filings show that not only do I not owe any U.S. taxes but I have accumulated thousands of dollars worth of foreign tax credits that will insulate my (Canadian) income from any U.S. tax liability for the foreseeable future.

    Nevertheless INTERNAL Revenue Service regulations require that I, a non-resident of the U.S. with no U.S. income, continue to file tax returns each year.

    Truth in marketing would require that the IRS rebrand itself as the Imperial Revenue Service.

  4. Pingback: Federal Judge Rules that Banks Must Follow the Law – Bridget Magnus and the World as Seen from 4'11"

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