Tax Withholding Cancels Tax Salience

One of the insidious things about the federal income tax system is that because for many people the tax money is withheld from their paycheck before they even see it, they don’t miss money they never really thought of as theirs in the first place.

Some anti-tax advocates think that withholding ought to be eliminated for just that reason. They think that if people got all of their paychecks and then had to turn around and write a check to the government, they’d get angrier about taxes and demand a cheaper, more efficient government.

I’ve got another idea that might help: Another insidious thing about the federal income tax system is that people pay in to it but don’t have any idea really what they paid for. Wouldn’t it be an eye opener if each American taxpayer’s dollars got matched up one-for-one with line-items in the U.S. budget, and each taxpayer got an annual report of exactly where those dollars got spent?

Imagine your thrill when you got your report at the end of the year and discovered that those extra hours you spent on the job to pay your taxes went to buy a $1.5 million bus stop in Alaska.

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