It’s an old complaint, but a valid one: after forking over hard-earned cash to the government, taxpayers often have no idea where, precisely, their money has gone. Progressive think tank Third Way has an innovative idea for an initiative that could solve that problem: taxpayer receipts that detail what duties are paying for.
Planet Money’s Jacob Goldstein points us to this paper (PDF), which details Third Way’s proposal. Here’s the crux of their argument:
According to the IRS website, in 2008 the median tax filer in America had an adjusted gross income of $34,140 and paid $2,790 in federal income taxes. Assuming that all of that income was earned through wages, this filer would also contribute $2,610 to Social Security and Medicare through FICA. That is a total of $5,400 in federal tax and FICA payments. For most people, that is an enormous sum of money—it certainly is for the median taxpayer.
Consumers can easily see detailed information on every product they buy, but the largest item that they purchase in a given year—their taxes—they get nothing. They have a right to know what they are paying for.
At left is a mock-up of what such a receipt might look like. What do you think of Third Way’s idea?
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