The Agitator #72 - The IRS
by Oliver_Halle
 The Agitator
May 15, 2013 09:38 AM | 1059 views | 2 2 comments | 20 20 recommendations | email to a friend | print | permalink

Partisan politics is keeping the Benghazi controversy on the front page, but in time with all the investigations and committee hearings the American people should know, as much as it’s possible to know, what happened, what went wrong, what could or could not have been prevented, and other related issues.  And while Fox News can be counted on to carry this story until at least 2014, if not 2016, in my opinion the much bigger event is how the IRS targeted conservative groups, such as different tea parties that sought a lawful tax exempt status. 

What makes this latest IRS scandal so egregious is that it is hardly the first time that politicians or bureaucrats have singled out their enemies, dissidents, or disfavored groups for “special” tax treatment.  Recall that Nixon’s enemies list included journalists, political opponents and almost anyone of prominence that disagreed with one or another of the president’s policies.  It seems that every few years history repeats itself, and the weapon of choice to destroy your opponent is the heavy hand of the IRS.  And it is as effective as it is scary.  At least in this instance there isn’t a scintilla of evidence that the president knew anything about what some renegade IRS officials apparently decided to do on their own. 

Anyone who has been on the IRS merry-go-round knows how time consuming, costly and difficult it is to get off it.  I’m sure that we can all count on the usual platitudes coming from our elected officials about the abuse of power, how they are going to introduce legislation to prevent future occurrences, and on and on with the same blather.  And this blather is a first cousin of the never ending promises of tax reform.  One of the reasons for the latest scandal is the complexity of the tax code.  The endless paperwork and labyrinthine regulations make it easy for a power hungry bureaucrat to frustrate an applicant for some kind of tax break.  For the ordinary working stiffs that have every good intention of paying what they owe, how often do they get caught up in some official’s scrutiny for reasons that will probably never be known?  The oppressive paperwork of compliance with the tax code is by itself reason enough to get rid of it.  Simplicity alone would go a long way toward many more people paying their taxes, but each year the IRS regulations grow by hundreds of additional pages providing a full employment bill for tax accountants and lawyers. 

I wish I had an answer for how to get our elected officials to begin a serious discussion about creating a whole new tax code that is simple for everyone.  But as long as special interests are willing to fund political campaigns to preserve their tax breaks, what you will get from your elected official is the usual rhetoric of how it’s time to throw out the current tax code coupled with all sorts of talk about a fair tax, flat tax, consumption tax, and other ideas.  Crowds get worked up, scream “right on”, leave filled with some hope, and end up with nothing.  As long as these same political folks can keep the people’s attention diverted over Benghazi and other such controversies, the shell game will continue as the ball of tax reform remains out of sight. 

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Oliver G. Halle
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May 16, 2013
Cobb County Guy, We agree that in an organization the tone is set at the top. The top in this instance appears to be the former acting head of the IRS. Whether some renegade bureaucrats acted in direct contradiction to the chief we don't know yet. To suggest, without evidence, that Obama failed to set the right tone, would be a stretch beyond credulity.

The complexities and ambiguities in the tax code and regulations allows corrupt officials and bureaucrats to manipulate the rules just as it does for taxpayers. It works both ways. That's why tax lawyers and accountants would hate to see the current tax code tossed and replaced by something comprehensible and simple.

I doubt that there would be a "tsunami of corporations seeking to locate and relocate to the U.S." if the corporate tax was eliminated. A lot of factors go into where corporations locate, and tax policy is only one. Maybe cheap labor in places like Bangladesh might be just one influence among others. Florida, a state with no income tax, several major ports, and a good climate has had one of the highest unemployment rates in the country. Could there be something else besides taxes that has not drawn a lot of new businesses?
CobbCoGuy
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May 15, 2013
"One of the reasons for the latest scandal is the complexity of the tax code."

No.

The scandal comes from corrupt bureaucrats, at least, based on what is known now. That said, IMHO, the "tone" of an organization is set at the top; but, that is a topic for another time.

The complexity added to the ability of said bureaucrats to play their games.

Be that as it may, I agree wholeheartedly that the code is too complex. If I were "king", I would eliminate all corporate income tax, because, for all intents and purposes, corporations do not pay income tax.

Could you imagine the tsunami of corporations seeking to locate and relocate to the U.S.?

Can you imagine the transfer of power from politicians to citizens since politicans would lose the ability to manipulate the tax code for favors?
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