An exploration of the absurd complexity of the American tax system and an astute comparison to many examples of simpler, effective tax collection by other governments around the world.
Throughout his well-reported, clearly written exposé of United States tax policy, Washington Post correspondent Reid (The Healing of America: A Global Quest for Better, Cheaper, and Fairer Health Care, 2009, etc.) reveals the follies of the concept of American exceptionalism and the misguided pride of presidents, members of Congress, and Internal Revenue Service commissioners. Put simply, American legislators are unwilling to learn from successful tax policies of nations willing to share their wisdom. By traveling to other countries and interviewing policymakers there, Reid demonstrates how tax simplification has functioned smoothly while still providing adequate revenue to operate sound government. (One of the shining examples is New Zealand.) American taxpayers wrestling with the annual tax deadline in April might feel infuriated when learning that in many nations, calculating taxes takes no more than 30 minutes. Although most Americans likely blame the IRS for the complexity of income tax returns, Reid explains that for the most part, the agency is carrying out the orders of the Senate and the House of Representatives. Members of Congress hide behind a desire for tax simplification while creating new rules that usually benefit wealthy individuals and large corporations. Reid explores tax evasion as well as tax complexity, demonstrating how wealthy but unscrupulous individuals and business enterprises hide their earnings in offshore tax havens such as Panama and the Cayman Islands. Not every chapter in the book features Reid’s admirable controlled outrage. In some chapters, the author calmly explores alternatives to an income tax, most notably a value-added tax on purchases, a system that has worked well in other nations.
Though Reid’s topic may be anathema to many readers, he makes it relentlessly revelatory and simple to understand.