Earlier today, I posted that New Jersey’s amnesty program has been very successful – in fact, more than three times their estimates.
Some of my colleagues have suggested a federal amnesty program might be a good idea, others believe that there might be abuse of such a program.
What do you think? Today’s Fix the Tax Code Friday question is:
Should the US offer a tax amnesty program similar to those in NJ and MD? Or is that asking for trouble?
KPE
I obviously vote yes.
To address an issue raised by a comment to your earlier post – the legislation creating a Federal Tax Amnesty program could include a condition that Congress would be prohibited from passing another Federal Tax Amnesty Program for at least ten (10) years after the conclusion of the current program. I doubt people would avoid paying current taxes if they had to wait at least 10 years before they could get relief.
And a Tax Amnesty program does not wipe out tax liability – all delinquent tax liabilities must be paid within the conditions of the program. Only penalty and interest – which multiplies rapidly and often overtakes actual tax liability, which is the real problem – would be “forgiven”. Tax Amnesty is not a way to avoid paying taxes.
TWTP
TWTP
I am going with yes.
But I think it would be a little unrealistic to put in the bill that congress wouldn’t pass another amnesty program within 10 years for 2 reasons.
1) Congress never likes giving up control and
2) If it is successful and brings in billions…there is no way that portion would survive – they would repeal that portion and create another program.
I say do it! The fact is that honest people are honest people and crooks are crooks. The people paying their taxes and obeying the tax laws, are not likely to stop being honest – at least not in great numbers. If we can get some of the crooks to come clean, then at least that is less money the rest of us have to make up.
On the other hand, it is all irrelevant because the more money the government gets, the more they are going to spend.
No, if you go by the numbers, it’s clear that tax amnesty leads to more late taxes.
All the responses given thus far are on target. I am always amazed at in a law abiding nation, we extend anmesty to those who break the law, especially those who do it intentionally. Guess that is cheaper to the government than the prisons we would have to build (still not a valid argument for amnesty programs).
I particularly like the comment about limiting the time another amnesty could be offered, and it seems to promote late filings or no filing. But we all can’t be candidates for Treasury Secretary or Healthcare czar, so the offer of amnesty are crumps to the masses to avoid the public outcry at “the best and gifted”who are tapped / offered the chance to serve their government, crooks and all.
But as NJ shows, it is not limited to the Federal government. Every state and local government have their share of tax delinquents too. Have you ever noticed the outing of these ‘worthy citizens’ is around election time, and it is expected to be close?
How about just scrapping the entire income tax system? Amnesty for everyone. (Sorry tax preparers & tax lawyers). Our government is plenty big enough without the tax collectors at the IRS.