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by kuyan 1947 days ago
Broadly, a couple reasons:

- Tax prep companies like Intuit have a vested interest in keeping tax prep difficult.

- Grover Norquist (Americans for Tax Reform) believes that making filing taxes easier will make people more okay with paying taxes, and as a result, many conservative policymakers won't bite. (It's slightly more complicated than this, but I believe this assessment to be accurate.)

Here's a Planet Money podcast: https://www.npr.org/sections/money/2017/03/22/521132960/epis...

And a ProPublica series on Intuit: https://www.propublica.org/series/the-turbotax-trap

2 comments

The second one is new to me. It's really fascinating how they choose a set of policies and work hard to construct a reality that supports the policy positions. It strikes me as so backwards.

It's tinfoil hat, but my only conclusion is the actual reasons for the policy are so incredibly unpopular that they invent these realities to obscure them.

How are they “constructing a reality?” How much taxes you pay is the reality. They’re trying to draw more attention to it, by forcing you to look the numbers in the face once a year. That’s not “constructing reality” it’s drawing attention to it.

I love paying my taxes and support higher taxes with more government services. But I agree with Norquist that it’s a useful exercise for people to go through once a year and write down how much they make and what part of that the government is taking. I don’t like the idea of socializing people to accept higher taxes by deducting them automatically and making it so they never have to think about how much they’re paying.

I think I'd be more aware of the overall state of my income and how it is taxed if I were given a nice organized summary of everything the IRS already knows about me.

Take investments. The current way I get 1099-INT and 1099-DIV forms from a variety of sources. I've got to go to each source and find and download the form.

They are all laid out differently, so there is some confusion when I'm trying to find the right number to use for my filing.

I get so caught up in the mechanics of finding the 1099s, and ensuring that I've got them all, and finding the right data and copying it to or adding it to the right line on the right form that I don't really notice the numbers themselves.

If the IRS sent me something that said "Here are all the 1099s we have received from your banks and brokers. We received forms from <list of banks and brokers>", and had a nice table of the 1099-INTs and 1099-DIVs and any other similar forms, each telling me where it was from, the amount of interest or dividends or whatever, how much of that was taxable, and if it was ordinary income, short term capital gains, or long term capital gains, with totals at the bottom, I'd be much more likely to actually notice the numbers.

Even if I still had to copy the numbers to my IRS filings, it would be a vast improvement, both to making less work for me and to Norquist's supposed goal of making me more aware of how much I make and how much of that goes to taxes.

> They’re trying to draw more attention to it

That’s what they are claiming, but there are many ways (probably a lot better), of drawing attention to taxes, aside from forcing you to go through a bad process.

Additionally, if they were truthful about what they are saying, they should be trying to draw attention to government budgets and make them transparent, i.e. how much the government spends and collects.

Government spending is out of control, and clearly people being forced to file their taxes through a crappy system hasn’t fixed that. Why would anyone ever think that keeping things as they are will do it?

Drawing attention to government budgets isn’t sufficient because most people just assume “someone else” will pay for them.
So was this tried somewhere and that’s what happened? Or are you just making it up?

Drawing attention to budgets should not only be about the way the money is spent, but also about the way the money is collected.

In any case, the point still stands. There are many ways to make people be aware of their taxes, and probably one of the worst is making it hard for people to file their tax return.

> So was this tried somewhere and that’s what happened? Or are you just making it up?

It’s been tried in America. The idea that we’ll have Scandinavian-style benefits without raising taxes on “middle class people” (defined to include people making as much money as five median households) is the centerpiece of the platform of the progressive wing of the Democratic Party, which has tremendous media visibility. Everyone acts like someone else will pay the $30 trillion price tag for Medicare for All, etc.

> But I agree with Norquist that it’s a useful exercise for people to go through once a year and write down how much they make and what part of that the government is taking.

Were it that simple, I would agree. This approach is problematic in the US because:

- the tax code is too complex for the average citizen to approach on their own,

- powerful interests such as Intuit have a vested interest in keeping things difficult for their own gain, and

- reporting your income incorrectly (when the IRS already knows what to expect!) can expose one potential criminal penalties.

> I don’t like the idea of socializing people to accept higher taxes by deducting them automatically and making it so they never have to think about how much they’re paying.

I think this is an implementation detail; there are solutions to removing unnecessary pain from tax filing that combat regulatory capture while keeping people involved with the process of taxation. Advocacy for lower taxes and tax reform are not mutually exclusive.

It's a misleading number anyway, since it doesn't include sales taxes, payroll taxes, or property taxes (whether directly or through a landlord), among other overlooked categories. For poorer people, those are actually most of their taxes, whereas for wealthy people income taxes are of course most of it.

And most people focus primarily on the balance or refund due and their marginal tax bracket, not on the total tax liability or the effective total tax rate. Lots of confused or inaccurate conclusions get drawn.

You still get your tax figures in places that do that automagically. You just don't get the suffer it out for conservative agenda experience.
The legal system is a construction, the rules we have to follow is a reality. A constructed reality.

Why is it constructed in that way? There's a reason, it doesn't come from nowhere. What is the reason?

Pretty basic stuff here

Is it the same in Canada? We have complex forms as well and software to help fill out forms.
It’s not as bad but the second reason is similar to why GST is added at the till. Certain politicians want to make sure the citizenry is angry about taxes.
Well suffice to say the population was pissed off when Mulroney passed the GST. So much he had to add extra senators to the Senate to get it passed.