Tuesday, April 15, 2008

The simpler the tax, the less the power 

Responding to something I said on air Saturday, Speed Gibson wonders why we don't have a simpler tax form for state income taxes (perhaps x% of the federal taxes paid.) The answer is quite simple: To do so means that the Legislature forgoes its ability use the tax code to favor its political supporters and harm political opponents. Filling out my own last night I noted the various credits offered for certain kinds of expenses. Luckily I have a child in a private school; I make too much to get a credit for that, but I do get a deduction. That tax policy makes it cheaper to send children to private schools, or to piano lessons, or for public schools to shield the cost of its extracurriculars from taxpayers. In Minnesota as much as any state, taxes can be much more burdensome if you don't spend your income in the ways the legislature has decided is socially desirable.

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