A Brief Timeline of Taxation of the US, Part 3
W. Marc Gilfillan, CPA, NC, individual and business CPA and Tax expert, shares about the history of taxes…
So, what happened with the tax system in the US?
US tax makers have been collecting what they have been sowing for a long time. The honor system has been trumped by a monster in which every tax payer is under surveillance due to the heavy inclination of evasion. In other words, consent has been replaced with compulsion. Honor has been replaced with spying on citizens. If you are feeling the pressure with today’s taxes, call a Cary NC CPA for all your tax-related needs!
In the 1950s, there was not a bank in the US that informed the IRS about customer affairs, interest was not reported, withdrawals of money weren’t reported, and nothing that went through any account was photographed. In addition to this, real estate transactions were not reported, stock transactions were not reported, dividends weren’t reported, income from other sources (Form 1099) was not reported, and US Customs did not require a declaration of cash carried. Go here if you want help from a modern-day Tax Preparation in Cary, NC.
It was an honor system, and it functioned quite well. The deterioration that occurred over the previous fifty years to now is that anything of any fiscal significance is now reported.
Adam Smith stated that taxes will be evaded and tax laws shown no credence when there is a general suspicion of a lot of unnecessary expense and great misspending of tax revenue. For example, $500 toliet seats, huge grants to study the sex lives of ants, etc.
For the sake of catching a handful of tax resisters and evaders in the 1950s Congress spawned a tax monster of the US tax system that more and more taxpayers attempt to evade. As a general rule, mass tax evasion is a sure signal that a government’s tax system isn’t working. Citizens will pay taxes, even income taxes, if the rates are acceptable.
Thanks for reading! Stay tuned for more updates!
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