Right, but then the problem is general lack of funds, not having them delayed by a year. With the exception of the first year of employment, one will have funds

Right, but then the problem is general lack of funds, not having them delayed by a year. With the exception of the first year of employment, one will have funds from previous year's tax return. I agree that this is annoying, but with minimum level of financial planning and responsibility (e.g. by withdrawing 1/26th of previous year's tax return every two weeks, or by withdrawing whatever fraction of the year one actually works), the effects of tax withholding can be almost completely mitigated. Is your argument that low-wage and part-time workers are irresponsible and cannot be trusted with large windfalls of money around tax return time, because they will squander them faster than they would if the same amount instead was given to them via biweekly installments?