CtTaxed.com

Two reasons to abolish the Federal Income Tax (I)

First, it is being used as a weapon of class warfare. More on that later. Second, it is an incredibly in-efficient and complex way to raise money.

The Director of the Congressional Budget Office believes that it costs American businesses somewhere between $400 and $500 billion a year to file tax returns. That does not include the time you and I spent as individuals to file our personal returns.

If we assume there are 113,146,000 households in American and it takes on average 4 hours to complete the tax return and we further assume our time is worth $10/hr the cost is $4.5 billion.

That $405 to $505 billion is a direct drain on our economy it adds nothing to the wealth of the nation, indeed it is very harmful to our economy. That $405 billion comes to $3,500 per household.

Want an additional $3,500 a year? Then support abolishing the Federal Income Tax.

IT is fair to assign the cost of business preparing their taxes as a direct tax on the American people. Because businesses do not pay taxes.

Businesses have never paid taxes, never. They always pass on the cost of taxes to the consumer, their business tax is embedded in the price we pay for goods and services. Everytime you go to the grocery store or the Doctor’s office you are paying their taxes. Yes, you pay taxes on your health care.

All taxes flow down hill and we are at the bottom.

There is no way a business can not pass on the taxes to the consumer and still stay in business.

This is a tax bite you do not feel as harshly as the income withholding taxes taken out of your pay every pay day. These are the hidden or embedded taxes and it is not without cause it is structured this way.

That is why the calculated tax freedom day is the total expenditure of government divided by the number of taxpayers and the number of days in the year. That is a true accounting of how much of our labors are diverted to the Federal government. The Tax Foundation has called April 30th, 2007 as Tax Freedom day or the day we start to work for ourselves. This does not of course included state income taxes, or state sales taxes. For us nutmeggers we work for the pleasure of the state in to JUNE!

Additionally there is 1 IRS employee per 3,500 Americans. Or about 115,000 IRS employees, they do not work for free and they have retirement plans and benefits, very good plans and benefits actually. The tax payer covers that cost also. Who else would?

Coupled with the fact you do not have a prayer of getting your taxes right. A famous Money Magazine study asked 49 tax accountants to do the same tax return and they got 49 different answers. A similar study showed the IRS was no better in giving advice to specific questions. I’ve tried the IRS help line and I was appalled at how little the official IRS helper appeared to know. Really basic questions only I think is the rule.

There is little that is right with the income tax, except it is good at what it was designed to do, raise a lot of money without truly informing the taxpayers just how much they do pay in taxes.

And at that it is really good.

Part III (no it will be part IV) will contain a proposal that is gaining a lot of attention around the country and in Washington. Part II will detail the negative effects an income tax has our society.

3 Responses to “Two reasons to abolish the Federal Income Tax (I)”

1. Don Pesci Says:
   September 17th, 2007 at 10:55 am

   What a wonderful — short — piece describing the deleterious effects of taxes, something never mentioned by growing crowd of special interests that need the instruction most.

2. cttaxed.com » Blog Archives » Abolish the Incomes Taxes (IV): The Fair Tax Says:
   September 26th, 2007 at 9:02 am

   […] Two reasons to abolish the Federal Income Tax (I) […]

3. jc penney credit card Says:
   February 26th, 2008 at 1:10 pm

   Useful site. Thank you.

Leave a Reply