4-14 Who Gets the Tax Breaks?
SANTA FE - The most dreaded time of year is here again. Income taxes are due tomorrow. Millions of Americans have pulled out the shoebox and are sorting through receipts and bills. If you haven't started yet, you may be too late.
On average, Americans filling out the long form spend 21.4 hours wading through the 172 pages of explanations for the federal form. Some 86 million more already have taken their records to a professional.
Every year the federal tax code gets longer. That's because thousands of industries and special interest groups across the country are constantly beseeching Congress for more deductions, exemptions, credits and exclusions.
And they are ever increasing because the rewards are generous for members of Congress who help those who can afford to return the favor with hefty campaign contributions.
These special benefits are estimated to reduce federal income taxes by $1 trillion a year. New Mexico is not a bit better. Our giveaways are estimated at $1 billion a year. Get rid of them and we've more than solved our deficit problem.
How do we solve this raid on the treasury? We don't. And likely never will. It's the American Way. Some call it free enterprise. Some call it capitalism. Some call it graft. Whatever you call it, there's no way to stop it.
Some force would have to come along that is stronger than all the special interest lobbyists in Washington - and Santa Fe. It would have to be a force stronger than the almighty dollar.
The current "Tea Party" movement has grabbed the stage as our savior. It's members say we are "Taxed Enough Already." Actually tax rates have gone down at the state and national levels for quite a few years so they can't be talking about that.
So it must be all the favored tax treatment these powerful groups are receiving that requires the rest of us pay a larger share of our governments' revenue. If that is the tea partiers' focus, they've come up with no concrete proposals. So far their image is one of anger and brandishing loaded weapons at public protests.
It would be truly awesome to see tea partiers channel all their pent up energy into something as positive as reforming our tax code.
Wouldn't it be great if members of Congress and the New Mexico Legislature felt their most important duty was to abolish all favored tax treatment or else lose their jobs?
One way to make that happen might be to legislate that no one employed or contracted by a favored industry could make contributions to any political candidate. We're already trying that with investment companies in New Mexico to stem the suspected securities fraud.
But it's not going to happen. Members of Congress and the Legislature can cite legitimate interests in promoting economic growth and helping struggling local industries. But in the long run, tax breaks are not the way to produce economic growth. It is the ability to provide services to industries that make a location attractive to them.
Or how about this? Wouldn't it be fun to see a list of every industry receiving an income tax break? Let's have a state list and a federal list. Of course we could wade through the instruction booklets but won't somebody make us some lists? We may need to know why ceiling fan importers need a tax break, for instance.
We sometimes hear members of Congress advocating income tax reform. It is a great issue for them. Voters love it. But the bills never go anywhere and the sponsors know they won't.
Lately we've been hearing that state legislators should take the same cuts as everyone else or Social Security and Medicare should cover that Congress.
Here's another idea. Make them all fill out their own tax forms. I'll bet you anything that none of them do. I've even read that the head of the Internal Revenue Service doesn't fill out his own form.