Rynar wrote:
The data point I was looking for was the cost of compliance with the tax code, which is estimated conservatively at $500 billion. Which is a quarter to a fifth of revenues collected, not the fifty percent I had indicated prior.
http://www.taxfoundation.org/blog/topic/96.htmlQuote:
Compliance Costs & Tax Complexity
The full cost a tax system is more than the amount of tax paid. It also includes the cost of tax planning and paperwork. Economists call these "tax compliance" costs, and the IRS estimates Americans spend 6.6 billion hours per year filling out tax forms—including 1.6 billion hours on the 1040 form alone. In 2002 Americans spent roughly $194 billion dollars on tax compliance. That amounts to 20 cents of compliance cost for every dollar collected by the tax system.
http://www.msnbc.msn.com/id/24112908/Quote:
If it's any consolation to the individual still trying to get receipts in order a day before Tuesday's filing deadline, businesses have it far worse. The National Taxpayers Union, in its annual look at the burdens of taxpaying, said the corporate cost of compliance is about $170 billion. General Electric in 2006 filed returns equivalent to 24,000 printed pages.
An Open Letter to the President, the Congress, and the American people by advocates of the FairTax Plan. (linked from
http://www.whitehouse.gov)
Quote:
The current U.S. income tax code is widely regarded by just about everyone as unfair, complex, wasteful, confusing, and costly. Businesses and other organizations spend more than six billion hours each year complying with the federal tax code. Estimated compliance costs conservatively top $225 billion annually – costs that are ultimately embedded in retail prices paid by consumers.
The numbers are not exact, and I'm a bit skeptical of putting out a cost estimate that includes how many hours individuals spend filling out their tax forms as a cost, but there you have it.
Personally, it seems the FairTax Plan provides many benefits and I'd like more national discussion concerning that and other tax reform opportunities.