Is there anything good about filing a tax return? For most of us, of course, it's a necessary ritual if we hope to stay on the right side of the law. And it certainly keeps the wheels turning for the federal government.
But is there another, more high-minded value to this annual April unpleasantness? Larry Zelenak, a law professor at Duke and the author of new book on income taxation, thinks the answer is yes.
“If, as Oliver Wendell Holmes Jr. said, ‘taxes are what we pay for civilized society,’ the filing of Form 1040 draws our attention to our duties as citizens in a way that no other levy, including a national sales tax, could,” Zelenak wrote Monday in a New York Times op-ed.
In his book, Learning to Love Form 1040: Two Cheers for the Return-Based Mass Income Tax, Zelenak makes this point even more explicit. Returns force us to confront how much we are actually paying to the federal government every year.
- Prompted by that information, taxpayers may reflect—as they should—on whether they are receiving good value from the federal government for their income tax dollars.
Return-free systems – including a VAT or a national sales tax – would not promote this sort of civic reflection. With another nod to Holmes, Zelenak concludes that “the filing of a tax return, with its high visibility and ceremonial aspect, calls the taxpayer’s attention to his status as a taxpayer and a purchaser of civilization in a way that would be impossible under a return free tax system.”
Zelenak is on to something. Filing a return is valuable, even if it’s painful. In fact, it’s valuable precisely because it’s painful. As I argued some years ago in my own op-ed, filing is probably too easy, not too hard.
- With paid preparers and sophisticated software, most Americans are protected from grappling with the worst features of the modern tax system. This may seem like a good thing, but it comes at a steep price.
Specifically, our filing aids make it easier to tolerate a bad tax system. “When it comes to taxes,” I wrote, “pain can be a good thing. It keeps people vigilant, encouraging them to keep a wary eye on government. That, in turn, exposes problems and encourages reform.”
In the years since I wrote those words, I’ve had occasion to file seven more tax returns. And I have to say, all the pain is starting to get to me. Zelenak, for his part, wants to make that pain a little less severe, and he endorses a variety of ideas that would simplify and streamline our April ritual.
But he wants very much to retain the essential nature of that ritual, and even to restore its former status as a badge of civic virtue.
I wish him luck. But the more I study tax history, the more I’m impressed with the centrality of tax collection in the evolution of U.S. tax policy. America, we often hear, is a nation of tax haters. Which is true, as far as it goes.
But people everywhere hate taxes. What makes the United States distinctive, I think, is our insistence on collecting so much of our tax revenue in a distinctly unpleasant way. No stealthy value-added taxes for us! We’re going to do it the hard way.
Which goes a long way toward explaining why we’re a low-tax country.