Americans yearn for simpler taxes as deadline passes
Agence France Presse
Washington, April 16:
Clutching bulging envelopes with paperwork they had spent hours to compile, thousands of Americans yesterday performed the yearly ritual of rushing to the nearest post office to beat the dreaded midnight deadline for filing their tax returns. The traditional last-minute scramble,
which forces the postal service to put up for one night with very ‘unpostal hours,’ marked the end of a three-and-a-half-month tax collection period designed to bring the US treasury about two trillion dollars in revenue. “We might not be able to make it easier for you to complete your taxes, but the postal service does make it easier for you to meet the deadline,” quipped its vice-president, Michael Spates.
As usual, there was no shortage of complaints about the US tax system being unwieldy and tilted toward serving the interests of the rich. But in an unusual break with tradition, this year the chorus of those disaffected was joined by none other than treasury secretary John Snow, who insisted that the US tax code ‘has grown larger, bulkier, more burdensome and lethargic with every passing year.’ “The code is so filled with loopholes, exceptions and lengthy explanations that individuals and businesses spend more than six billion hours every year on paperwork and other tax headaches,” Snow complained in an online chat with taxpayers.
According to government figures, the yearly ritual now costs the country roughly $130 billion, nearly two-thirds of which are being forked over by individual taxpayers who spend hundreds of dollars on lawyers, professional tax preparers, software packages and other devices to give Uncle Sam his due. On average, it took every American about 25 hours this year to prepare his or her tax return, the statistics show. So far, president George W Bush, who last year campaigned for re-election on the promise to simplify the US tax system, has not formally endorsed any of the proposals bandied around by experts and pundits inside and outside the US capital. But the issue was expected to move to the forefront of national debate in late July, when a presidential bipartisan panel is scheduled to unveil a tax reform plan.
Despite extra efforts to accommodate late tax filers, the government still anticipates a nearly $300 billion shortfall due to various forms of cheating by both corporations and individuals. Setting a good example, the White House reported yesterday that the president and First Lady Laura Bush had already paid $207,307 in federal income taxes this year on income of $672,788 coming mainly from Bush’s salary and the couple’s investments. Vice-President Richard Cheney and his wife made nearly twice as much, reporting $1,328,678 in income last year — and $393,518 in federal taxes.
Curiously, the vice-president’s take included $194,852 paid to him by Texas-based oil service company Halliburton accused of receiving lucrative no-bid contracts in Iraq and of overcharging the US government. Cheney, who served as Halliburton’s chief executive from 1995 to 2000, has a deferred compensation arrangement with the firm.
US tax law
WASHINGTON: The United States has a progressive tax system that establishes six various tax rates for people with various income levels, with 35 per cent being the highest and 10 per cent the lowest. Some have suggested the country’s economy would be better served by a flat tax rate of 15 or 17 per cent that would apply to everybody. But Snow gave no indication if the flat tax was among the suggestions considered by the panel during the six meetings it has held thus far in various parts of the country.