Earlier this week, NTU Foundation released a study on the need for fundamental tax reform and what the alternatives to the current system is at the federal level. Check out the summary below and be sure to share it with your fellow taxpayers!
The U.S. tax system is time-consuming, expensive, and intrusive, and as the ongoing IRS scandal investigations have shown, its administration is subject to abuse and mismanagement of taxpayers' sensitive information. This week, National Taxpayers Union Foundation (NTUF) released a new analysis of the dire and growing risks present in the current tax system – and the ways in which the most prominent reform options could address those risks.
NTUF’s study offers an in-depth breakdown of the problems with the Tax Code, including the burden it places on our economy and the struggles the IRS has faced with security, as identity fraud-related crimes remain severe despite increases in enforcement staff and funding.
The analysis also breaks down the latest tax reform proposal from House Ways and Means Committee Chairman Dave Camp (R-MI), along with the Fair Tax and Flat Tax plans, clearly showing how all these reforms might mend our broken system.
“Three big challenges have beset our tax system: complexity, cost, and centralization,” said study author and NTUF Policy Analyst Michael Tasselmyer. “As these problems wreak havoc on taxpayers and as a result hurt our economy, the need for a thorough analysis of the alternatives has never been more urgent.”
The highlights from NTUF’s new Policy Paper, “The Need for Tax Reform: Simplicity, Savings, and Security”:
- The Code itself is now over 3.9 million words, and is accompanied by federal regulations that tally 10.48 million words, or 14,000 pages.
- The burden of tax compliance cost the economy $224 billion in 2013.
- The IRS reported nearly 642,000 cases of identity theft in 2012 – nearly 400,000 more than the prior year!
- It takes one division of the IRS nearly a year to resolve an identity theft case (312 days).
Tasselmyer concluded, “The current tax system appears to be falling short of fulfilling its most basic duty to protect Americans’ financial lives, burdening them with compliance and security issues that go beyond simply the revenue collected – our analysis finds that failure is only compounding as the status quo remains.”