LISTEN to today's conversation with T.R. Reid!
In December of 2017, President Trump signed the Tax Cuts and Jobs Act. Despite the sweeping changes it has enacted, the new act still fails to fully address the issues that have plagued our tax code for decades. The act does little to reverse our nation’s growing income inequality and filing taxes remains an arduous and complicated task. We know we need a fairer and more efficient tax code, but what exactly does this look like?
And how do we achieve the necessary changes?
Veteran correspondent and bestselling author T. R. Reid travels the world in order to find out what makes for good taxation (if that’s not an oxymoron!) and brings that knowledge home in A FINE MESS: A Global Quest for a Simpler, Fairer, and More Efficient Tax System, now available in paperback. Join him on April 16th as he explores the many reasons our tax code needs to be completely rewritten, including:
In 2016, Americans spent over 6 billion hours and 12 billion dollars filing their taxes. In the Netherlands, the average filing time is 15 minutes. In Estonia, it takes 7 minutes.
The US tax code has 73,000 pages of IRS regulations. In Japan, paying income tax is an automatic process for 80% of households. Thanks to the Bureau of Tax Simplification, only 1 in 5 people in the UK had to file at all.
Congress has given themselves various
tax breaks and deductions that other Americans don’t. In Slovakia, government representatives pay 5% more in tax.
· The US has completely missed the boat
on the value-added tax (VAT), the most useful, fair, and simple taxing innovation of the last half century. 170 countries has adopted VAT. Only the U.S. and a handful of extremely poor nations
– Cuba, Iraq and South Sudan – have not.
· US billionaires can pay relatively very little tax, and sometimes no tax at all. France, Norway, and Switzerland all have wealth taxes designed to reduce economic inequality.
· US companies exploit loopholes by moving profits offshore. By many estimates, there is more than $2 trillion permanently “invested” overseas. Apple, for example, payed zero tax on an income of $74 billion by relocating to Ireland.
Reid argues that we can write a tax code that is fair and simple and can also cut tax rates while still bringing in the revenue required; we simply need to learn from the world’s
other democracies. Other rich countries like ours—advanced, high-tech, free-market democracies—have devised tax regimes that are equitable, effective, and easy on the taxpayer. By looking at these tax systems, we can learn what the United States should and shouldn’t do in writing the Internal Revenue Code of the future.
Doing our taxes may never be America’s favorite pastime, but it can and should be so much easier.
About the Author
T. R. Reid is a longtime correspondent for The Washington Post and former chief of its Tokyo and London bureaus. He is also a commentator for National Public Radio and a correspondent for several PBS documentaries. His bestselling books include The Healing of America, The United States of Europe, The Chip, and Confucius Lives Next Door.