BLACK TAXPAYERS ARE AUDITED AT 2.9 TO 4.7 TIMES THE RATE OF NON-BLACK TAXPAYERS
Steve HayesThis is the conclusion of a study conducted by the Stanford Institute for Economic Policy Research (SIEPR) in conjunction with the Department of the Treasury investigating approximately 148 million tax returns.
Here are some of the findings in the study:
- The U.S. federal government annually collects $4 trillion in tax revenue to fund public programs ranging from economic regulation to military defense.
- Increasingly, policymakers have also come to rely on the tax system for implementing a host of social programs; for example, the Earned Income Tax Credit (EITC) has replaced welfare as the largest cash-based safety net program in the United States.
- The Internal Revenue Service (IRS) administers these programs and is also charged with ensuring that individuals meet their taxpaying obligations.
- Like tax authorities around the world, it relies on audits to detect underreporting of tax liabilities and to verify that taxpayers qualify for the benefits they claim.
- The task of selecting which taxpayers to audit is in large part an exercise in predicting which taxpayers have underreported tax obligations that an audit would uncover.
- Modern machine learning methods offer the potential to enhance the efficiency of audits by improving predictive accuracy, but a growing literature in algorithmic fairness warns that policies based upon such predictions may inadvertently reinforce disadvantages against historically marginalized groups.
- We find that the difference in audit rates for Black and non-Black taxpayers is primarily driven by the difference in audit rates among taxpayers who claim the EITC.
- Black taxpayers claiming the EITC are between 2.9 and 4.4 times as likely to be audited as non-Black EITC claimants. In contrast, we observe a much smaller, though still statistically significant, difference in audit rates between Black and non-Black taxpayers who do not claim the EITC.
The purpose of any tax system is to raise money to fund the government. Any rational person will want to fund the government in a way that is:
- Simple to understand and pay
- Rewards work and encourages saving
- Doesn’t hurt the economy
- Costs the least to collect
- Is difficult to evade
- Doesn’t require intrusive audits of taxpayers and loss of personal freedom
Under the income/payroll tax system, if you are entitled to the earned income tax credit, you don’t qualify until you file your tax return for the previous year.
When the FAIRtax is enacted:
- Each taxpayer will receive a monthly prebate to enable them to make purchases of new goods and retail services up to the poverty level for their family size and pay no FAIRtax out of their own pocket on those purchases.
- If Congress wants to provide additional benefits to certain groups of citizens, it must do so directly through legislation, not by hiding it in the tax code.
With the FAIRtax, if the government wants to grant benefits to certain groups of citizens and make other groups pay for it, they’ll have to do it openly through legislation. When the system of collecting the revenue the government needs to operate focuses only on that one task, the system can be much simpler and much more transparent with respect to how Congress spends our money.
The present income/payroll tax system uses the threat of force as a major incentive to get citizens to comply with the tax code. Additionally, the IRS routinely tramples on some of our most basic rights in its efforts to collect taxes. For example, when dealing with the IRS, there is no presumption of innocence. If the IRS says you owe taxes and penalties, they don’t have to prove your guilt. You have to prove your innocence.
The bureaucrats will defend their actions of higher audit rates for Black Americans by stating that their computers are the ones that select citizens for audit and that they’re only trying to do their job of collecting the taxes that are owed.
This is the same argument made for forcing our financial institutions to provide all of our transactions in our bank accounts to the IRS—it is necessary to collect taxes.
Albert Einstein said, Nothing is more destructive of respect for the government and the law of the land than passing laws which cannot be enforced.
The problem is not so much the bureaucrats themselves, but the income/payroll tax system they so heartily embrace.
The FAIRtax transfers power from the government to the people.
We now have the opportunity to force all Members of the House to show where they stand. They can:
- Vote for the present income/payroll tax system or for the FAIRtax.
- Support the corrupt income tax and the IRS or eliminate it. It can’t be any simpler than that.
- Hide the true cost of their government or pass the FAIRtax and show the true cost of government on each receipt.
- Support the largest transfer of power from government to the people, the FAIRtax, or not.
Please stand with us and demand that your representative support a much fairer, much simpler and much more efficient way to fund the government—the FAIRtax!
The FAIRtax doesn’t pick winners and losers. Because it taxes spending, not earnings, the FAIRtax lets everyone save for their retirement tax free.
The FAIRtax collects the revenue that the federal government needs to operate but does it in a way that has the least impact on our individual freedom and the least impact on our economic prosperity.
There are no tax returns to file and no records to keep. We pay our federal taxes when we make retail purchases of new goods and services, and there is no need for the IRS. If you sell a used couch or used jet ski online, there is no FAIRtax due on that transaction.
The FAIRtax will allow us to TAKE BACK CONTROL.
The income/payroll tax system is broken and no longer working—we can’t repair it but we can replace it with the FAIRTAX!
Join us and TAKE BACK CONTROL OF OUR COUNTRY AND OUR LIVES—NOT WITH BULLETS BUT WITH THE ELIMINATION OF ONE OF THE BIGGEST THREATS TO OUR LIBERTY AND ECONOMIC PROSPERITY—THE INCOME/PAYROLL TAX.
We all should remember Edmund Burke’s warning that applies to our efforts to TAKE BACK CONTROL,
“Nobody made a greater mistake than he who did nothing because he could do only a little.”
We should also remember this quote from George Orwell's 1984, which, if we do nothing, may foretell your and your children's future:
“If you want a picture of the future, imagine a boot stamping on a human face—forever.”
WHAT CAN EACH OF US DO?
We can write letters and make calls to our elected representatives and attend Zoom town hall meetings demanding that if they really want to allow Americans to “TAKE BACK CONTROL”, the first step is to eliminate the income/payroll tax system and enact the FAIRTAX!
TAKE BACK CONTROL! Help us PASS THE FAIRTAX!
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