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Wednesday, September 22, 2010

Big Government and its cronies use income tax to make relationship clear: They own you and your labor, and will dole back what they please

Whose Money Is It Anyway?

(The New American) --

Since the advent of the income tax, it has been obvious that governments believe that their citizens’ earnings actually belong to the government first and that citizens should simply be grateful for whatever pittance their overlords let them keep. Payroll deductions, such as those for income tax, Social Security, and Medicare, have made that state of affairs even plainer; the money is extracted from the employee’s paycheck before he ever sees it. Because the notion that government has the first claim on one’s earnings smacks of communism (and rightly so), most Western governments have been loath to admit that they actually believe in it — until now.

Her Majesty’s Revenue and Customs (HMRC), the United Kingdom’s tax-collection agency, has issued a proposal called “centralized deductions,” whereby an employer would send an employee’s gross earnings to HMRC, which would then deduct the appropriate taxes and remit the balance to the employee — all done electronically, of course. In other words, the government gets the employee’s earnings first and lets the employee keep whatever it deems appropriate.

The proposal is part of a larger discussion paper put forth in July in an attempt to reform the current Pay As You Earn system, which is similar to the United States’ payroll-deductions system, albeit with fewer options for employees. HMRC suggests that employers supply the tax agency “real time information” on those being paid so that HMRC can in turn provide employers with the appropriate tax codes for those employees, enabling more accurate tax assessments throughout the year.

Once Real Time Information has been fully implemented, HMRC proposes “a further, more radical, option” — namely, sending gross pay to the government first and letting it dispense to employees what remains after taxes. The government, naturally, couches this “radical” option in comforting language, saying that it would save employers and taxpayers considerable effort and money and assuring taxpayers that “the system would adhere to the high standards of taxpayer confidentiality that characterize the existing system.”

Those “high standards” are, as anyone familiar with the workings of government might expect, a joke. For example, in 2007 HMRC lost two compact discs containing “personal and banking [information] of 25 million people,” as ITPro reported at the time — a breach serious enough to force the resignation of the then-head of HMRC. Earlier this year the agency sent out as many as 50,000 tax-credit notices containing private information about persons other than the intended recipients of the notices, according to the Register...MORE...LINK

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