Friday, August 01, 2003

Congress Should Pass a Law (or, We Pay Taxes to Avoid Jail)

The Congress should pass a law requiring the IRS to include a section on income tax returns where filers can donate money, beyond their tax liability, to the federal government. They should also require that the IRS aggressively publicize this option as a great way to support dear programs. To encourage donations, the tax forms could have a space to enter a two digit code designating which government agency or program will receive the excess funds. (Allowing filers to earmark their money isn't crucial, however. How targeted the donations can be will depend upon the logistics of listing the options and processing the claims. The process will become simpler as we transition to electronic forms.)

This is a good idea for several reasons. First, it will bring extra revenue to the federal government in a painless way. Second, it will provide tax payers a forum to express their true priorities. To the degree people want the NEA to have more money, they’ll donate. Third, it's a step toward the ideal world where everyone recognizes their duty to support the common good voluntarily.

Fourth, it will reframe the way people conceive of taxes and tax cuts.

Opponents of the Bush tax cuts implicitly suggest that they are more generous and compassionate than those who prefer low tax rates. Heavily publicizing the option of donating money to the government will change the nature of the debate. No longer will Nancy Pelosi be able to complain about the tax cut without a reporter asking, "So you're going to continue paying at the 40% rate, and are encouraging others to do the same?"

The talking heads who publicly supported the tax cut should have reminded viewers, time and again, that cashing the refund checks is optional. If someone wants to give government more money than their government demands, return the check to the US Treasury. The money would fund worthy programs.

Michael Moore would have to argue that he doesn’t think he should give more money to the government (he’s promised to spend his tax rebate fighting Bush) but why he wants to threaten others with jail time for not giving enough. Whatever nobility results from championing higher taxes is squandered the moment you concede that you only pay high taxes, but won't do so if not threatened by force, because you'll go to jail otherwise.

Which is my point. We pay taxes to stay out of jail. Nancy Pelosi pays taxes to stay out of jail. There’s not much generosity in either of our decisions to avoid the pen. Tax rates are not about generosity. Publicizing the option of donating money to the government will highlight the distinction between submitting to threats of force (paying taxes) and generosity (donating to government). The bloated chest thumpers will fall off their pedestals. If they want to be moral, they can give.

Furthermore, the idea is a no-brainer politically. It's impossible to make the argument that government shouldn't encourage people to donate money. The government of course believes it does important work, and has every right to ask for the help of good, generous, people. It should start doing so.


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