The Tax Enforcers

This morning I read an article in the Wall Street Journal titled, White House Leans Toward Tighter Enforcement of Taxes . It said…

White House officials disclosed the tax initiative on Tuesday, saying they intend to explore ways to better enforce the current code as well as improve it by eliminating corporate subsidies and untangling its many complexities.

Everybody is in favor of a simpler tax code and a more fair tax code. But toward the end of the article was this paragraph…

Back home, one of the biggest remaining problems is underreporting by small businesses that deal in cash -- as many contractors do. Among the possible further steps: requiring small businesses to use bank accounts, and using the tax code to encourage homeowners to report to the IRS the money they have paid to contractors.

Having grown up in the cold war era, this type of enforcement seems more appropriate for a communist country. A communist government would force you to conduct your business a certain way. A communist country would tell you it was your duty to tell on your neighbor.  It just doesn’t feel right. Why is it that all these rules and regulations are imposed on honest people? Dishonest people won’t comply anyway.

Comments

[Darren]

Hmm. Good point. In this economy, I actually expected the Treasury and IRS to become less diligent in their efforts to enforce the code. If they make the news by beating up on small business and/or home owners, they're really going to look bad and get some bad press, eh? Seems like they'd want to avoid that at a time when the Treasury and other parts of our government are handing out money and making SBA loans, etc., more available, all in an attempt to get businesses and people to spend money. Back off and let it flow!