Tuesday, September 21, 2010

UK Proposes All Paychecks Go to the State First

From CNBC.com (Sept. 20):

The UK's tax collection agency is putting forth a proposal that all employers send employee paychecks to the government, after which the government would deduct what it deems as the appropriate tax and pay the employees by bank transfer.

The proposal by Her Majesty's Revenue and Customs (HMRC) stresses the need for employers to provide real-time information to the government so that it can monitor all payments and make a better assessment of whether the correct tax is being paid. [read more]

At first this may sound like a good idea. After all it saves the taxpayer mental aggravation in figuring out the tax code and doing the taxes. But what if the gov't screws up the tax calculation (which according to the article could happen)? If could take months for the gov't to correct their mistake.

The question is could this system be coming to America? I rather have a simplified tax system than the gov't just calculating what you owe and deducting it from your income automatically.

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