1040 Reasons to Scrap the Tax Code

It will be of little avail to the people that the laws are made by men of their own choice, if the laws be so voluminous that they cannot be read, or so incoherent that they cannot be understood; if they be repealed or revised before they are promulgated, or undergo such incessant changes that no man, who knows what the law is today, can guess what it will be tomorrow.
- Alexander Hamilton or James Madison, The Federalist, 1787-1788

It's April again, which means many Americans are engaged in that time-honored annual tradition: filing income taxes. Hard-working people across the land are brewing a pot of coffee, assembling receipts on their dining room table and beginning the process of muttering and perspiring as they attempt to calculate how much of their earnings will be taken by the federal treasury.

This year alone Americans will spend billions of hours and hundreds of billions of dollars trying to comply with a million-word tax code. This places a tremendous strain and drain on individuals, businesses, and the economy as a whole, unless you happen to be an accountant, IRS agent or coffee bean grower (or unless you print IRS forms -- the agency sends out eight billion pages of forms and instructions each year).

There is universal agreement that the current system is incomprehensible, inequitable and indefensible. In my three years as a representative of Indiana's 8th District I have never had a constituent say to me, "Congressman, we love the tax system. Please do all you can to preserve it." On the contrary, union members and CEOs, small business owners and single mothers, farmers and professors agree the current tax code is just too, well, taxing.

In a nutshell, here's how that system works: employers send W-2 forms to their employees; the IRS sends instructions and forms; the taxpayer assembles these and other documents, then tries to comprehend a mathematical story problem that would give Stephen Hawking a headache (or seems to prove the chaos theory). Once an answer is reached, the taxpayer sends in his or her forms -- praying they're correct and will not lead to a dreaded audit -- quite often attached to a check for an amount that would have paid for a year's worth of rent, clothing and food.

In 1948, the typical American family of four paid just 3 percent of its income in federal taxes, according to the Heritage Foundation. Today, this family pays nearly 25 percent of its income in federal taxes alone. That's more than a 800 percent increase! In return for that massive increase, we have not eliminated poverty, we have not eradicated crime, we have not wiped out illiteracy. There has been no corresponding 800 percent improvement in life expectancy or social well being. There may have been an 800 percent increase in television talk shows during these corresponding years, but there may be no connection.

The federal government has proven that while it's good at taking money, it's not quite as efficient at employing that money to solve the nation's problems. Meanwhile, Americans are having to work a lot harder to make ends meet. They're not getting their money's worth and many are saying "enough!"

During the last two years, Congress heard that cry and responded. We offered Americans the first tax relief in 16 years: a net $95 billion in tax relief for Americans at all stages of life over five years. That money has already begun to re-enter the economy, generating growth and economic development, creating jobs, stimulating savings, enhancing education and lessening the burden on farmers and small business owners.

Equally as gratifying, the House voted to reform and overhaul the IRS. The bill overhauled the management, administration and oversight structure of the agency and restored the tried-and-true American concept of "innocent until proven guilty" for those dragged into court.

These measures, while important and good, deal with symptoms, but fail to treat the disease. The prescription calls for us to scrap the code altogether! It is becoming increasingly clear to lawmakers, as it has long ago to most Americans, that continuously reworking an unworkable system is just silly. We need to rip the current tax structure out by its roots and establish a simpler, more equitable form of taxation. There are a number of proposals worthy of consideration. For me, a national consumption (sales) tax is the least complicated and most fair method, but other options would be preferable to the proven failure operating today.

Imagine not having to worry about paying taxes on April 15 because you've paid them at the checkout counter. Loopholes would be eliminated, fairness would be restored and you would never have to fill out a tax form again. A good first step would be the repeal of the 16th Amendment -- which empowered Congress to collect taxes on incomes -- and I am the cosponsor of a bill that does just that. Until that becomes a reality, I will continue to fight to let the Hoosiers I represent keep more of their own money so they can do what the government is so often incapable of doing: spend it wisely.

TAX FACTS:

• The Gettysburg Address is 269 words, the Declaration of Independence is 1,337 words, and the Holy Bible is only 773,000 words. The tax law has grown from 11,400 words in 1913 to more than one million words today.
• There are at least 480 different tax forms, each with many pages of instructions.
• Even the easiest form, the 1040EZ, has 33 pages of instructions, all in fine print.
• The IRS sends out 8 billion pages of forms and instructions each year. Laid end to end, they would stretch 28 times around the earth.
• Nearly 300,000 trees are cut down yearly to produce the paper for all the IRS forms and instructions.
• American taxpayers spend $200 billion and 5.4 billion hours working to comply with federal taxes each year, more than it takes to produce every car, truck and van in the U.S.
• The burden of compliance is the equivalent to a staff of 3 million people working full time for a year, just to comply with the taxes on individuals and businesses.
• The IRS employs 114,000 people: twice as many as the CIA and five times more than the FBI.
• 60 percent of taxpayers must hire a professional to get through their own return.
• Taxes eat up to 38.2 percent of the average family's income; that's more than for food, clothing and shelter combined.