The old progressive notion of American income taxes--still viable though modern conservatives simply will not hear of it--is that the income tax is the fairest tax of all because, absent rate increases, you only pay more if you come into more.
Conversely, if you lose your job and don't have as much money as before, then you pay less in income taxes, or even nothing. But you still must make certain basic consumer purchases applying the same level of taxation no matter your circumstance.
The sales tax has no conscience. The income tax has one.
People railing loudest against income taxes ... they just got a raise, or promotion, or bonus, most likely. And their complaining rings a bit hollow.
No matter the percentage applied to calculate their taxes on their additional income, their burden remains but a percentage of their new bounty, and they're going to be better off than they were before they came into it.
Conservatives like to say Americans are discouraged from doing better because of the punitive, confiscatory nature of personal income taxes. But I personally know firsthand of no person declining additional money because it would be taxed at 39 percent, leaving him only 61 percent of the additional money.
Sixty-one percent of more remains better than zero percent of the same.
Gripe? Yes. Give it up? No.
But there was one other principle that some of the early progressives espoused when creating the American income-tax system a little more than a century ago. It was that the federal government should design an income-tax structure to produce the amount of money it needs, but never try to use that income-tax system to do anything more than collect an adequate amount of money fairly. It was that government should not try to use the tax system to force behaviors.
That principle hasn't been followed so well, or much at all.
Our tax code is a thick mountain of overlapping complications because of myriad efforts over the decades to try to influence behavior with deductions and credits--and, as it happens, penalties, such as one under Obamacare for not having health insurance, which is now under attack in the Republicans' Senate-side tax bill.
The essence of the Affordable Care Act is that everyone should have health insurance not only for their own good, but for the good of everyone. That's because premiums could be kept more affordable through a universal pool of premium-payers.
The best way to enforce that mandate is with a fine for noncompliance. And the most efficient way to collect that fine is in an additional line or two on annual income-tax returns.
That's entirely a matter of convenience and efficiency.
We could create a new agency to keep a registry of every American's health insurance situation. We could establish an enforcement division to seek to collect noncompliance penalties. But it is infinitely cheaper and easier to print a couple more lines on those already universally circulated income-tax forms.
It makes sense that we've piggy-backed the income tax nearly to death. It's so handy.
Now Senate Republicans, most of whom abhor Obamacare or are strung out from telling their voters that they do, are proposing to eliminate that individual mandate and the intended stick of the tax penalty.
Presumably, a lot of working people, relieved of the tax penalty for noncompliance, would blow off their health insurance.
The Congressional Budget Office says 13 million Americans will do that very thing and send premiums rising at a rate of 10 percent a year for the rest of us.
And Republicans would do celebratory somersaults over the savings--or, as I put it, the throwing of millions of Americans off health insurance.
The nonprofit Kaiser Foundation, citing surveys, says maybe not. It thinks most insured Americans, confronted upon renewal with still-subsidized premiums, would tend to re-up year-to-year even without a mandate and penalty.
Polls depend entirely on the phrasing of the question.
Do you think the federal government should force you to buy health insurance and penalize you on your income taxes if you don't? Oh, no.
Do you think Republicans should continue to try to dismantle the Affordable Care Act by repealing key elements of it like the individual mandate? Oh, no.
Here are the real questions: Should our income-tax system be retained but made simpler? Should health insurance be required of the citizenry? If so, should the government subsidize premiums for low- and middle-income persons? If so, should the government impose a financial penalty on those not getting health insurance? If so, is the annual income-tax return the best place to assign that penalty?
For me, it's yes to that entire paragraph.
We can and should live both by rules of fairness and rules of expediency, if all those rules serve a functioning government and ensured health care for everyone.
John Brummett, whose column appears regularly in the Arkansas Democrat-Gazette, was inducted into the Arkansas Writers' Hall of Fame in 2014. Email him at email@example.com. Read his @johnbrummett Twitter feed.
Editorial on 11/26/2017
Print Headline: Fairness and expediency