Sunday, April 13, 2014

The invisible tax and you.

       In discussing school fees today I became agitated.  Both sides, in this two party system, have managed to sneak in "Invisible" taxes.  What I mean is the tax that derives itself from indirect means, thus it is not immediately obvious as a tax.

       For example: the invisible tax in schools comes from chronically under-funding them.  This causes the schools to impose "fees" on the students who enroll.  Individual states have, in their constitution, that they will fund schools to make them "free" for residents.  Illinois does.  In fact, according to the Illinois constitution:   "The State has the primary responsibility for financing the system of public education."  (http://www.ilga.gov/commission/lrb/con10.htm).
       So how on earth, when the state says it is their responsibility to pay for education, are extra fees even allowed?  For that matter, why does everyone's property tax bill reflect LOCAL government collecting taxes to fund education.  (The largest percentage of the property tax bill for every county I checked).  Let them know how you feel, while you're at it.  (http://www.ilga.gov/senate/)(http://www.ilga.gov/house/).

       Another invisible tax is the under-reimbursement to hospitals, by medicare.  If the hospital has spent money treating a patient, and been kind enough to extend credit to the government for those services, (despite being the single worst payer in the system), for a previously agreed upon amount, the least they can do is pay that amount.  (mind you, that amount is already less than what everyone else is expected to pay)(Example).
       Instead they hire an army of politically-connected consultants to scour through the bills, looking for inconsistencies, and then refusing to pay.  Try doing that to the government.  If a doctor, or hospital is abusing the system, the government should be forced to make their case and prosecute; not refuse legitimate payments.
       So how is this an invisible tax?  The hospital needs that money.  Guess who's bill just went up.  Joe and Jane insurance-holder.  The insurance responds by only paying "standard and customary" amounts, and you get stuck with the rest.  To fix this: "All rates for services rendered will be paid at the standard and customary rates, determined by averaging all local healthcare providers, or those used by insurance, whichever is lower."

       In the interest of brevity I will stop at these two.  The most egregious examples I could find.  There are countless examples though. (ever pay a fee at a forest preserve?)  In the interest of transparency, this cannot be allowed.  A simple adjustment to state constitutions can fix this.  "The state shall impose no fees, over and above any tax rates, and shall pay all activities out of the general fund"  This means no licence fees, no usage fees, no tolls.  Would taxes go up? Technically yes, and technically no.  No, because you are paying those extra fees already.  Your tax percentage would go up, so you would see it, and thus more people would be aware of the abuse.

       In fact, while we're at it let's go all crazy-town and propose that: "Only income shall be taxed, and income from all sources, be they interest, sale of property, capital gains, or wages, will be taxed at the same rate.  Bartered goods or services will be taxed at listed cash values."  Under this system the appreciation of your home would only impact your income, and net worth, at the time of sale.  So you would not be taxed on an assumed value you do not benefit from.  Like you are under the current system.

       But then I live in a dream world where politicians have the interests of their constituency at heart.  They don't. (Rules are for thee, not for me.)

       

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Keep it clean and well thought out.