Replace the IRS With What?

Many people live constantly in opposition to all taxes.We are taxed every time we turn around and sometimes in mid-turn. We are taxed enough already, many people believe. Everywhere I go speaking to various groups of citizens during this election cycle, the issue of taxes always comes up in the question and answer time.

Several years ago, I hosted a talk show on local radio. Often a friend of mine would drop by the station to express his opinions about the topics under discussion. However, I was not able to keep the radio show going due to allergic reactions to the treatments for my cancer. My friend moved somewhere up north and I seldom hear from him, until last week when he stopped by for a visit on his way to Florida for vacation. He is always filled with many opinions on lots of subjects. His main concern last week was the issue of taxes. He said, “I am a supporter of the Flat, Fair Tax.” I then asked him, which tax he supported, the flat or the fair tax and he said, “Yes!”

His confusion is shared by many people.

The flat and fair taxes are two different systems of reform of the federal tax code. They are not the same. Trying to understand the monster of the tax system in our nation is near to impossible. Trying to find a way to explain the various opinions regarding making reforms to the system is also hard to explain. In this column I will not attempt to explain either tax system. My purpose is to point out the fact that as long as we have the 16th Amendment to our United States Constitution, we have the federal income tax system being overseen by the Internal Revenue Service. The IRS is a bad word to most folks, causing many people to call for it to be abolished. During an election year it is easy to stir a crowd with passionate emotion calling for doing away with the IRS and imposing another system of taxation. I am in favor of doing away with the IRS. I support tax reform. The issue that must be addressed is the reality that doing away with the IRS is not the final answer. The issue is what will replace the IRS.

Do we put in place a national consumption tax? Do we develop a system of graduated or progressive brackets according to the level of financial attainment reached by the taxpayer? A consumption tax would cause all taxes to go up higher and higher as the consumer purchases goods and services. By passing a flat or even fair tax, all deductions would be gone. No loopholes would be allowed, and all would pay a sales tax as they purchase goods or services. From where I stand, the issue of taxes seems to be like the weather — everybody talks about it, but nobody can do anything about taxes, yet, except increase them.

Should we have the Flat Tax or the Fair Tax system to replace the IRS? Tell us in comments. 

Follow Ray Newman on Twitter — @RayNewmanSr.