End Withholding!

It’s tax season, and with it comes the excitement from those individuals who receive a tax refund from Uncle Sam. It’s been a while since I have fallen into that category and every April I write a big fat check to the IRS and try not to wishfully dream about how I could have spent that money myself.

Now imagine if everyone had to write a check to the government instead of receive one. Imagine if everyone had to write a check every month for the taxes they owe! I bet there would be demonstrations in the streets!

Like most permanent government programs, automatic, mandatory withholding first began as a “temporary” measure during Would War II to raise funds for the government fast.

When the measure was passed, only four percent of the population actually paid income taxes. But the problem for those who believe in limited government is that automatic withholding makes individuals less aware of the amount of taxes they pay, and thus makes it easier for the government to slowly raise taxes in the future.

 Even the Treasury Department admits this:

” greatly eased the collection of the tax for both the taxpayer and the Bureau of Internal Revenue. However, it also greatly reduced the taxpayer’s awareness of the amount of tax being collected, i.e. it reduced the transparency of the tax, which made it easier to raise taxes in the future.”

In 2001, C4L Chairman Ron Paul introduced legislation to end automatic withholding and require all taxpayers to write a check to the government each month. Unfortunately, the “Cost of Government Awareness Act of 2001” did not gain much traction from a government addiction to spending.

Ending automatic withholding (or at least letting people opt out) would make Americans more aware of their tax burden and also make it more difficult for the government to raise taxes.

Perhaps its time for this “temporary” program from World War II to finally end.