Thursday, May 14, 1998

IRS overhaul won't improve tax code mess

The reason for overhauling the Internal Revenue Service is not that the agency itself is responsible for the horrendous tax code it must enforce or that it is peopled with thugs who would as soon slam a sledgehammer on a taxpayer's kneecaps as give him an even break.

No, the reason is that the IRS has been granted too much authority and pushed too hard by a growing government hungry for loot and that its emphasis consequently has been more on revenue retrieval than respecting the citizens it is supposed to be serving.

The legislation that was passed 97-0 by the U.S. Senate the other day will not set everything aright, but as some of its proponents suggested, it could begin to change the culture of an institution that has measured its success more by dollar signs than by fairness.

If the bill makes it through a conference committee relatively intact and is then signed by President Clinton as seems certain, it will, among other things, set up a new oversight mechanism, put the burden of proof on the IRS in certain court cases and suspend penalties when a taxpayer was not notified within a year of a violation. The thrust of these and other provisions is to put consideration of the taxpayer on an equal footing with collection.

There will be a cost -- some $18 billion in foregone revenues over 10 years -- and some proposed offsets seem more gimmicky than real. That's not the end of the world. Anyone who takes seriously the values of a free, democratic society has to agree that trying to avoid abuses by this enormously powerful government agency -- some of them downright oppressive -- is more important than trying to siphon every cent possible under law from the pockets of taxpayers.

It's true, as many argue, that the worst culprit in American taxation is a code so convoluted and complicated that no single individual anywhere begins to comprehend more than a portion of it. But the Senate-passed legislation does require Congress to pay more attention to the complexity of tax measures it considers, and it also requires the IRS to report annually on what provisions in the code most bedevil taxpayers.

What's more, obviously, this legislation and tax reform are not mutually exclusive. Some Republicans even see the IRS overhaul as the first step down the path to a flat tax or maybe a national consumer tax replacing the present, graduated income tax.

The Senate bill should be welcomed by the American people as an improvement consistent with our national ideals, even if it is not a panacea for all our tax problems.