Just saw this news story today. Obama’s cronies in Chicago to Pay for Informing on Tax Cheats
You dirty rat.
Chicago and Cook County residents aren’t the only ones about to get shocking tax news; the city is debuting a “tax whistle-blower” plan that could turn neighbor against neighbor in Chicago’s business community.
The folks at city hall will pay cash bounties to informants who turn in business tax cheats around the city. The reward would amount to some sort of percentage of the tax money that the city recovers.
“It would probably be … a business knowing that a competitor is not remitting a tax. An employee [of the tax-dodging business] could know that, too. Typically, you need to provide some type of incentive.”
If you think this sounds like a good idea, you are dead wrong.
This program isn’t about “reporting a crime” which is what we all ought to do when we see a crime committed. The point is that it gives people A SHARE OF THE MONEY THEY HELP CONFISCATE!
Chicago is turning civilian spying into a state-backed business.
Whatever your feelings about the criminality/non-criminality of tax evasion (conscientious objection, etc), this program doesn’t have anything to do with citizenship and crime reporting. It is state-backed and rather than dissuade “bad behavior” actually encourages it.
Look at the procedure and then the incentive systems.
- Some one makes a report that they suspect you are cheating (whether it’s true or not).
- You are now under suspicion and the burden is not on another to prove your guilt (as with all tax audits) the burden is on you to prove your innocence. A large and costly bureaucracy processes and then follows up on these investigations.
- If you are innocent, then what? You’re out your time, your good name, your reputation, etc. Just like with an audit. Except that with this program, any of your employees, competitors, enemies, etc, – a civilian IRS – can trigger a costly audit.
What’s the incentive to falsely report people (or report them even though you don’t have hard evidence) in the hopes that in the audit something is discovered and you get paid?
What’s the incentive to go through your neighbor’s trash or to engage in entrapment (encouraging your neighbor to evade, then reporting it later)?
Ed Walsh, in the news story above, actually cites the example of “a business knowing that a competitor is not remitting a tax.” And how would they know that? Through corporate espionage, that’s how. Or else, just based on “suspicion” because the competitor is outperforming them.
This program creates an atmosphere of distrust, of spying, of meddling in one another’s affairs and incentivizes people to take illegal steps in order to try and discover tax cheating. In short, it encourages HORRIBLE behavior, worse than the behavior it intends to target, and dangles financial incentives in front of people if they do so.