America doesn't have a tax base problem, it has a spending priority problem. The total government system in the US collects more in taxes than the entire German economy is worth. You'd think we could have nice roads given that. The problem is what that money is being spent on.
Our tax system is also extraordinarily complex, with thousands of taxes, and a tax code that the IRS doesn't even fully understand. Individual Americans spend $300+ billion (last I recall reading) just preparing their taxes each year.
If a number seems hard to believe, it probably is. Think it through--how many hours do you spend doing your taxes each year? A few hours? How many hours do you spend showering and brushing your teeth each year?
Maybe it's businesses--but the entire US legal sector is only about $150 billion.
eh. most people don't correctly fill out their taxes.
Did you pay your use taxes? (actually, I believe that has been simplified, in california, allowing you to pay a flat fee now.)
If you ordered anything from amazon tax free, well, you should have filed your use taxes. I know one person, besides me, that does, and I pay someone else to do it.
There are all sorts of other little gotchas, even if you are an employee on a 1040EZ.
Also, this complexity leads to incredible risk; I mean, I generally don't mind paying taxes. (I mean, I'd like to pay less, but eh, I've shopped around, and the rates here are pretty okay for what I need and what I get.) but I fear nothing like I fear the tax man. With almost any other tax mistake? the worst that can happen is corporate and personal bankruptcy.
Now, screw up your taxes? yeah, you aren't particularly likely to go to jail, I mean, assuming you weren't trying to commit fraud, but it is pretty easy to end up with a whole lot of debt that you can't run out on.
Because of this, I outsource nearly all my accounting and bookkeeping. and yeah, it costs money, but as far as I can tell? it's the only insurance I can buy against one of the very few (likely) events that can put me in debt for life.
(Now, obviously, this is only scary because I have a low-margin business with revenue that is substantial compared to my personal earning power; if the IRS reclassified some of my revenue as income? it wouldn't take very much to put me in the red. If you are on a 1040ez and you miss your use tax and get audited? eh, it's not a bankruptcy event.)
I don't hire someone to brush my teeth for me at $65 / hour or $250 / hour etc.
The US Government disagrees with you.
"The cost of preparing and filing all business and personal tax returns is estimated to be $250 to $300 billion each year. According to a 2005 report from the U.S. Government Accountability Office, the efficiency cost of the tax system—the output that is lost over and above the tax itself—is between $240 billion and $600 billion per year."
"The Government Accountability Office (GAO) is the audit, evaluation, and investigative arm of the United States Congress. It is part of the legislative branch of the United States government."
A tax is a burden imposed upon me by an external force. In the case of taxes it's generally completely involuntary. I voluntarily brush my teeth. There's a very, very, very large difference between having a time and financial cost imposed upon you, and choosing to spend a few dollars and x hours per month on brushing my teeth.
If someone is imposing a tax upon you, it's properly their responsibility to make sure it's as efficient and as non-painful as possible (in terms of time to file, added costs, etc). The US Government has completely failed in that regard. It's almost universally agreed (aka bi-partisan) that we have a disaster of a tax code complication wise.
1.75 million accountants in the US. That's about 60% more than there are lawyers.
> I don't hire someone to brush my teeth for me at $65 / hour or $250 / hour etc.
But that's not how the numbers you're pointing to were generated. They put a $39/hour figure on the time people spent to do their own taxes. My point is that if you put a $39/hour figure on say brushing and showering, you get something like $15,000 per year spent on personal hygiene, about 1/2 of the individual income.
You brush your teeth so your mouth doesn't taste like shit and your teeth don't fall out. You hire an accountant to do your taxes because the tax code cannot be understood by anyone who hasn't devoted his life to deciphering it.
The difference is that there's not a damn thing you can do about your teeth getting dirty (but brush them), but the tax code could be a hell of a lot simpler if only they'd stop making it more complicated.
A bit cynical. Taxes for the majority of Americans are simple enough to be done without accountants, and even without any kind of tax filing software. Meanwhile, no matter how simple or complicated the tax codes get, businesses will always need accountants.
Our tax system is also extraordinarily complex, with thousands of taxes, and a tax code that the IRS doesn't even fully understand. Individual Americans spend $300+ billion (last I recall reading) just preparing their taxes each year.