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I live in New Zealand. I don't have to file taxes if my income is a standard wage my tax payments are automatic. My employer deducts them from my wage and they
by xupybd 10y ago
I live in New Zealand. I don't have to file taxes if my income is a standard wage my tax payments are automatic. My employer deducts them from my wage and they are sent to the IRD (Our government tax dept). My student loan and super payments are also automatic. If there is anything wrong then at the end of the tax year I can file to correct things.
I also get donations rebates, this is a one page form that lists all my charitable donations. Very easy very quick.
All my details are available to me online. All transactions are there and it's very transparent.
Why would anyone oppose a simple system like this?
- JacobHenner 10y agoBecause it'd put accountants, lawyers, and firms like these out of work.
- cmurf 10y agoSo in other words, the free market has produced a pile of jobs that we don't really need? Lobbyists get paid money to get politicians to supply a deduction as a line item on some obscure form, which increases red tape, which requires a need for a free market service, the revenue from that service in turn goes to feed more lobbying for more red tape. This is basically collusion, using the worst aspects of the free market and government, in simultaneous failures. Meanwhile, the accounting and tax lay industry is part of the lobbying effort to grow their business on the back end, rather than making the case to the customer on the front end. It'd double dealing. So I'm hardly sympathetic, but yes considering there are an ass tonne of jobs that would just vanish overnight, there'd maybe need to be a transitional phase, just avoid an abrupt change. But how do you shrink a market in a non-disruptive and fair way considering it grew in a distruptive and unfair way in the first place?
- iopq 10y ago> the free market it's not the free market when you lobby the GOVERNMENT to do what you want it to do
- baddox 10y agoFor most definitions of "free market," government subsidy of an industry doesn't qualify.
- usrusr 10y agoIt might be helpful to think of "free market" as a scale instead of an absolute definition. Level one free market: socialism, where people were still using money from a salary to buy everyday goods from people-owned "enterprises". Level ten free market: you buy protection at market rates or someone takes away your sandwich, if the protection takes the sandwich don't buy from the same vendor again. I imagine discussing relative merits within the range of roughly level four to level eight would be far more fruitful than the usual "my free market is tougher than your free market" posturing.
- lettergram 10y ago> So in other words, the free market has produced a pile of jobs that we don't really need? Our current system is the opposite of a free market. You can think of paying your monthly rent payment, your banking, etc. as (mostly) free market. You can think of taxes, DMV, healthcare, etc. as not free market.
- baursak 10y agoHousing is very far from free market, from zoning regulations to building codes to property taxes and school districts to rental regulations. Banking is also pretty much the opposite of it, from the Federal Reserve dependency to Fannie and Freddie loan guarantees.
- lettergram 10y agoFair, but both are significantly more free than others. Rent is not really heavily regulated outside of California and New York. Similarly, banking is indeed regulated in specific sectors, but not really across the board
- thwarted 10y agoSo in other words, the free market has produced a pile of jobs that we don't really need? Lobbyists get paid money to get politicians to supply a deduction as a line item on some obscure form Politicians protecting an industry through action or inaction, no matter if its lobbyists or others suggesting that they do, isn't the free market.
- bicknergseng 10y agoYah. We should make regulation for this kind of behavior.
- ptc 10y agoOh boy, I really want to hear how you think the "Free Market" solves this problem. Remember kids: If it's broken, apply Free Market liberally to the affected areas.
- spectrum1234 10y agoUh..get rid of the government involved in all these tax laws. Obviously? Are you suggesting complicated taxes isn't the government's fault?
- rtpg 10y agoI think the implication is that countries that espouse their "free market"-ness end up with a lot of regulatory capture. This, telecoms, healthcare. A bunch of people with a lot of money have been able to lock in their positions. It sure feels like pulling out of the church of laissez-faire economics would let us, say, pass laws with things like price controls (or just nationalizing the whole industry!). An aside: complicated taxes aren't the opposite of "free market". For example, giving tax incentives to new companies can help make a market more free by reducing the cost of entry.
- chongli 10y agoSorry, you're never going to have a society where the government is a 100% neutral referee and everybody else is a part of the 'free market'. As long as there is an incentive to rig the game, people are gonna rig it.
- rhizome 10y agoWhy shouldn't they have to adapt to rapid changes in the "free" market like we do? Notice it wasn't called anything like the "dot-com gradual-and-not-too-painful realignment." Why the special consideration for tax people? I mean, if we're going to vaunt the free market, let's let it splash everybody, not just the little guys.
- aithoughts 10y agoI'm surprised most people don't think like this. I think that we have a cultural problem. People chose to take out loans for their tertiary education because of our beliefs in the tertiary educational system. College is to get a job, but we believe it's there for us to "discover ourselves." And that's how we end up with accountants. Sometimes I wish there was some website where non-partisan smart people scientifically identified the current problems and come up with a finite, exhaustive list of possible problems. And then, determine the amount of money it would take to test a hypothesis. If they do and it fails, then they must take into account that hypothesis and correct for it. How much money would need to be raised? It's just too bad that I've never encountered anyone in real life that thinks like this. It feels so intuitive when you approach it like a computer problem. I think the problem is that that political science is paradoxical in itself and goes against on of the most important tenets of science and reason: that we must give up our beliefs if the evidence proves them wrong. Is there anyone out there who is balanced enough to actually be bipartisan? How would one search for such a unicorn? Is it really impossible?
- Trill-I-Am 10y agoSuch a list isn't possible because of differing interpretations of reality and basic facts and differing interpretations of what even constitutes a problem.
- foota 10y agoThe United States has a complicated tax code because it attempts to make things more "fair" for some people. Some of these are things people like, such as deductions for people with children, paying mortage, etc. Some are more dubious.
- amenghra 10y agoEvery country has a somewhat complex and unique tax code. Filing taxes is however much simple in some other countries compared to usa.
- euyyn 10y ago> The United States has a complicated tax code because it attempts to make things more "fair" for some people. As opposed to the other countries with automated taxes, that don't attempt it?
- rtpg 10y agoOne difficulty is that it's easier to pass a tax break through a budget process than to pass an equivalent "handout" through a separate one. For example, in France if you have more than 3(?) kids, you get 70% off all train rides. That required this whole process to get set up (I imagine it was more through regulation than law but you at least need the budget to the SNCF). The easiest way to get an equivalent thing through the US legal bureaucracy would be to do: "If you send us receipts of your train tickets and have over 3 kids, we'll deduct them from your taxes at 70%". It "pays for itself" in the sense that the government doesn't have to give money to Amtrack, just give back money that was just given to it by the taxpayer. It doesn't require intergovernmental coordination, just the IRS. It can be passed through the huge budget process. Much easier than many other regulatory schemes.
- ptaipale 10y agoWell, yes. For instance, Finland, where I live, has a very much simplified income tax collection procedure. Deductions for people with children have been eliminated. Deductions for mortgages are being eliminated. All this in the name of simplicity and, yes, fairness. After all, if you can afford a mortgage, you are clearly well-off, so you should be taxed more. (And there is a good point: Mortgage deductions distort the housing market. But rent subsidies distort it even more.)
- chillingeffect 10y agoU.s. govt uses tax code to incentive behaviors. We have 1040ez which is almost as simple as the NZ system if citizens don't want or have any deductions.
- shrewduser 10y agoThis really has nothing to do with the topic, every country uses tax codes in that way we just have a simplified system to calculate and pay taxes in other countries
- deathanatos 10y agoI think the comment has everything to do with it: every time you use the tax code to legislate the behavior and choices of the people, it causes the tax code to become less simple by the very fact that the citizen now has to track that behavior. For example, take charitable donations. Because they're tax deductible, I have to track them, or forfeit the deduction. That's extra, manual work that must be done. Now multiply that out for every behavior that some congressman thinks should be encouraged, and it shouldn't be surprised that the taxes are complicated. A tax form is essentially a giant function, but one with tons of inputs. It can only be automated once all the inputs are known (essentially, that's the job of tax software). The only person that has all of those inputs is you, so you're forced to buy TurboTax to be able to reasonably input and evaluate taxes. If you're thinking that all these inputs could ever be tracked by the federal government in a giant database, I still think it's crazy: you'd need a database for student loan interest paid, which every loan organization reports to, for charitable donations, for stock purchases, for stock sales, for dependents, etc. (I don't even know how you'd begin to track dependents, aside from how we do it now: manually.)
- deathanatos 10y agoThe 1040EZ has a long list of requirements that can exclude someone from filing with it; including, in some circumstances, those with otherwise simple tax situations (1 job with 1 income).
- erispoe 10y ago
- jjeaff 10y agoIt's almost that simple in the US if your situation is that simple. What happens in NZ if you make $400 selling vintage cabbage patch dolls on eBay? What if you earned $1k in returns on your investment account? What if you are renting your place out on Airbnb? If all you have is a simple income in the US, then the 1040ez is a single page and you can file it for free online if you make under a certain amount. You can pay a few dollars to file online if you make more. Obamacare has added an extra level of complexity now, but that is also very simple if you don't need or want the subsidy.
- xupybd 10y agoYes you have to file an IR3 if you make other income. http://www.ird.govt.nz/income-tax-individual/end-year/ir3/iit-what-is-ir3.html http://www.ird.govt.nz/income-tax-individual/end-year/ir3/ii... My favourite part of our tax system is the advice to file if you have "income from an illegal enterprise" EDIT: Just as a reply to the original point. I'm not sure how complicated the US system is. I'm not trying to say it's bad either, it just seems to me that we have a system similar to the one that is getting lobbied against. And I like our system, it works well for me..
- deleted 10y ago[deleted]
- azernik 10y agoThis advice is probably not explicitly given by the IRS, but it is what any decent tax attorney will tell you. They got Al Capone not for his other crimes, but for tax evasion.
- mikeash 10y agoThe IRS is totally explicit about this: "Income from illegal activities, such as money from dealing illegal drugs, must be included in your income on Form 1040, line 21, or on Schedule C or Schedule C-EZ (Form 1040) if from your self-employment activity." "If you receive a bribe, include it in your income." "You must include kickbacks, side commissions, push money, or similar payments you receive in your income on Form 1040, line 21, or on Schedule C or Schedule C-EZ (Form 1040), if from your self-employment activity." "If you steal property, you must report its fair market value in your income in the year you steal it unless in the same year, you return it to its rightful owner." See: https://www.irs.gov/publications/p17/ch12.html https://www.irs.gov/publications/p17/ch12.html
- stephen_g 10y agoYep, same for Australia - taxes are withheld automatically from your pay and then at the end of the year, you put and extra income and your deductions into the free web app that the tax office provides. I don't think I've ever spent more than an hour filing my return.
- hackits 10y agoYeah,,, consider yourself lucky that you were never employed by a employer who didn't provide PAYG summary. That is all-ways a interesting conversation with the ATO and your accountant.
- rayiner 10y ago> Why would anyone oppose a simple system like this? Because you want to make people angry and upset at least once a year at the government? Because you want to remind people that taxes are something the government takes, instead of letting them think of taxes as money they never earned to begin with. I love paying my taxes, but if you think taxes are bad (and lots of people do), then the current U.S. system makes total sense.
- krisroadruck 10y agoYou... love paying taxes?
- deleted 10y ago[deleted]
- rayiner 10y agoI'm an immigrant. I consider it a blessing to be able to do so.
- dopamean 10y agoI equate this to the first time I paid my own rent. I loved it. I was paying my own money for my own place and it felt awesome. It seems crazy to love paying rent but there was a period of time where I did.
- imjustsaying 10y agoI'm an immigrant. I consider it robbery to be intimidated by force into paying taxes.
- abduhl 10y agoNot to be rude but why'd you immigrate then? It's not like taxes just started happening recently.
- 10y ago
- wnevets 10y agobecause far too many people vote against their own interest just so gay people can't get married, or transgenders using the right bathrooms or to stop the war on christmas or whatever fake crisis was invented for that election year.
- hellgas00 10y agoIt works the other way around as well. The left votes for social issues that upset the established cultural state, and which in the grand scheme of things will have minimal real impact (like transgender people using any specific bathroom). Social issues are a dividing force that occupies both sides of the spectrum, it's conveniently used as a means to divide and conquer. It's why most politicians will take on social issues as their political battle cry and shy away from issues that will impact financial markets. It's easier if you don't bite the hand that feeds you (wealthy donors).
- cderwin 10y ago> because far too many people vote against their own interest You don't get to decide what other people's interests are, and you certainly cannot make an empirical case that the interests of all individuals would be better served by voting one way or the other. This sort of reductionism and failure to interact with people you disagree with in good faith ought to have no place on a professional forum like this.
- wnevets 10y ago>You don't get to decide what other people's interests are, I absolutely can,there are far too many voters who are now upset that obamacare & the aca are the same thing and they're going to lose their health insurance.
- rospaya 10y agoI've been reading this thread and it's insane. In technology impaired Croatia since this tax season I don't even have to report any tax returns, everything is completely automatic. "Paying taxes" is a number on my paycheck that says how much money went to healthcare, tax authority etc.
- kwhitefoot 10y agoSame here in Norway. They send me the form to fill in but it is already filled in so all I have to do is correct anything that is wrong or missing. For me that is only property and money held off-shore. And, of course, I can make the corrections on-line using the tax department web site and I get an immediate estimate of how much tax is due (or overpaid) after the corrections. Of course Turbo Tax would be against a system like this because for most people it would mean that they don't need to pay Turbo Tax.
- ensignavenger 10y agoIn the US, taxes are usually deducted from your paycheck- however, you have to file every year because the amount deducted is rarely even close to the actual amount owed. Not sure how it breaks down, but I would not be surprised if the majority of people in the US get refunds every year because the Government takes more than they are entitles to. This gives the Government free float. It would be wonderful if we had a more simple tax system where the withholdings could be accurate without needing to tell your employer too much about your private affairs.
- mvindahl 10y agoPretty much same system here in .dk. I remember when I was a child back in the 1980s and my dad went through the annual ritual of filing taxes. It was a big hairy mess of papers accompanied with colourful cusswords. These days it's just a quick glance at a prefilled form (we can correct values but we usually don't need to).