Editor: Virginia’s recovery is already riddled with complications exacerbated by the ongoing pandemic. As the state begins reopening, it is critical to address tangible issues affecting Virginians’ daily lives.
Experts have showcased the anticipated K-shaped recovery, signaling the permanent loss of jobs across our heaviest hit sectors. With unemployment stagnated across the state and economic growth stifled, the biggest priority is ensuring that Virginians can maintain financial independence and stability.
However, in response to economic concerns, some have sought to exploit the goal of economic recovery by proposing a transformation of the entire tax system. Their panacea: return-free filing. Proponents argue that RFF would streamline the tax collection. They claim that, by implementing RFF, the tax system would be simplified—the process made easier for all Americans. Unfortunately, that is just not the case.
In reality, an RFF system would take control away from everyday Americans, placing it in the hands of the Internal Revenue Service. It would establish the IRS as not only the tax receiver and auditor, but also as the tax preparer. As such, the federal government would have full authority over the tax collection process, cutting out the entire private market of small businesses and local tax professionals.
The United States currently operates under a system of voluntary tax disclosure, in which taxpayers work with accountants or use tax software to determine owed taxes for the year before submitting these claims to the IRS on their own behalf. It is not a flawless process, but it works effectively and promotes private industry. Countless Americans have jobs due to our current voluntary tax system—but an RFF system would change that.
Amid the COVID-19 pandemic, the cost of lost livelihoods is far too great a price to pay.
Indeed, our state’s current economic recovery is shaky enough as it is. The unpredictable position that many Americans find themselves in will only be worsened by the higher unemployment and slower economic growth that this proposal would create. Rather than simplify the process as proponents claim, return-free filing would complicate and overwhelm the IRS when they are already struggling with a detrimental backlog.
Worse yet, a recent Progressive Policy Institute study found that return-free filing does not provide much of a societal benefit at all. RFF does not raise revenue for our schools or infrastructure, pay down public debts, or make the tax code any fairer or transparent. In short, the proposal provides no real benefits other than greater government control over our lives while risking real economic harm.
Virginians are in no position to be left out of the process, to lose autonomy in their financial decisions, and to ultimately take the brunt of the economic repercussions of an overhauled system. RFF would sacrifice jobs and economic growth while failing to succeed in the goals it sets for itself. Implementation of this system serves as a “lose-lose” for all parties, but taxpayers ultimately bear the biggest burden.
A return-free filing system is a raw deal for Virginians. This policy blunder is a show of action for lawmakers at the expense of their constituents. To best serve the people of Virginia, policymakers need to improve upon the current issues instead of transforming systems to create new problems. The RFF is just that—a leap in the wrong direction. We should be about less government and more freedom.
Eric C. Johnson, South Riding