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| Congress to I.R.S.: Don’t Even Think of Helping Taxpayers | Congress to I.R.S.: Don’t Even Think of Helping Taxpayers |
| (about 11 hours later) | |
| Congress has landed on one of those rare ideas that commands support from both Democrats and Republicans. Unfortunately, it’s a bad one. | Congress has landed on one of those rare ideas that commands support from both Democrats and Republicans. Unfortunately, it’s a bad one. |
| On Tuesday, the House approved legislation misleadingly titled the Taxpayer First Act that includes a provision prohibiting the Internal Revenue Service from developing a free online system that most American households could use to file their taxes. The Senate is considering a similar piece of bipartisan legislation. | On Tuesday, the House approved legislation misleadingly titled the Taxpayer First Act that includes a provision prohibiting the Internal Revenue Service from developing a free online system that most American households could use to file their taxes. The Senate is considering a similar piece of bipartisan legislation. |
| This makes no sense. Congress should be making it easier for Americans to file their taxes. Instead of barring the I.R.S. from making April a little less miserable, why isn’t Congress requiring the I.R.S. to create a free tax filing website? | This makes no sense. Congress should be making it easier for Americans to file their taxes. Instead of barring the I.R.S. from making April a little less miserable, why isn’t Congress requiring the I.R.S. to create a free tax filing website? |
| Better yet, the United States could emulate the roughly three dozen countries, including Chile, Japan and Britain, where most taxpayers do not need to fill out tax returns. In some of those countries, the accuracy of tax withholding is sufficient to obviate the annual filing process. In others, the government sends out completed forms to most taxpayers. In Estonia, filing taxes can be done in less than three minutes. | Better yet, the United States could emulate the roughly three dozen countries, including Chile, Japan and Britain, where most taxpayers do not need to fill out tax returns. In some of those countries, the accuracy of tax withholding is sufficient to obviate the annual filing process. In others, the government sends out completed forms to most taxpayers. In Estonia, filing taxes can be done in less than three minutes. |
| The federal government collects enough information about most American households to mail out a completed tax form that people would simply need to verify, sign and return. President Ronald Reagan proposed a version of just such a system. In 1998, Congress passed a law instructing the I.R.S. to develop such a system by 2008. President Barack Obama endorsed the concept during the 2008 presidential campaign. It still hasn’t happened. | The federal government collects enough information about most American households to mail out a completed tax form that people would simply need to verify, sign and return. President Ronald Reagan proposed a version of just such a system. In 1998, Congress passed a law instructing the I.R.S. to develop such a system by 2008. President Barack Obama endorsed the concept during the 2008 presidential campaign. It still hasn’t happened. |
| The explanation is sad but not surprising. The most vocal opponent of simplicity is Intuit, the maker of TurboTax, which has spent millions of dollars lobbying against efforts to reduce demand for its services. The company draws support from conservatives worried that making it easier to file taxes would make it easier to raise taxes. | The explanation is sad but not surprising. The most vocal opponent of simplicity is Intuit, the maker of TurboTax, which has spent millions of dollars lobbying against efforts to reduce demand for its services. The company draws support from conservatives worried that making it easier to file taxes would make it easier to raise taxes. |
| Since the early 2000s, the government has required Intuit and its competitors to offer free tax-filing software to the 70 percent of taxpayers with the lowest incomes. The legislation requires the I.R.S. to continue the Free File program rather than developing its own. Senator Ron Wyden, the Oregon Democrat who is co-sponsoring the Senate version of the bill, said on Wednesday that the I.R.S. would retain the authority to end the Free File program. But a number of independent experts, including the National Consumer Law Center, said the bill removed that exit ramp. | |
| But only about 3 percent of taxpayers use the programs. | But only about 3 percent of taxpayers use the programs. |
| Intuit and its allies, including proponents of the legislation, say that it’s cheaper and better for the government to let private companies run the system. But companies have little incentive to advertise the availability of free filing or to make the system easy to use. Indeed, they have every reason to steer people away from the free products. That is how they make money. | Intuit and its allies, including proponents of the legislation, say that it’s cheaper and better for the government to let private companies run the system. But companies have little incentive to advertise the availability of free filing or to make the system easy to use. Indeed, they have every reason to steer people away from the free products. That is how they make money. |
| As a result, the government is saving taxpayer money at the expense of those taxpayers. | As a result, the government is saving taxpayer money at the expense of those taxpayers. |
| There is evidence that automatic payment systems can make it easier to raise prices. A 2009 study found agencies raised toll rates after the adoption of E-ZPass, perhaps because drivers were less likely to object if they were unaware of the increases. But an automatic filing system also might help taxpayers to save money. For example, almost a quarter of eligible households don’t claim the earned-income tax credit. | |
| Members of Congress pay lip service to ideas like filing taxes on a postcard, but they continue to perpetuate the current system of mass April immiseration by preventing the most obvious and effective way to simplify tax collection. | Members of Congress pay lip service to ideas like filing taxes on a postcard, but they continue to perpetuate the current system of mass April immiseration by preventing the most obvious and effective way to simplify tax collection. |
| Americans with complicated finances are stuck with the misery of the current tax system. That’s no reason to force most Americans to join them. | Americans with complicated finances are stuck with the misery of the current tax system. That’s no reason to force most Americans to join them. |
| The Times is committed to publishing a diversity of letters to the editor. We’d like to hear what you think about this or any of our articles. Here are some tips. And here’s our email: letters@nytimes.com. | The Times is committed to publishing a diversity of letters to the editor. We’d like to hear what you think about this or any of our articles. Here are some tips. And here’s our email: letters@nytimes.com. |
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