The IRS Non-Scandal Calls For a National Sales Tax

Story Stream
recent articles

As seemingly every sentient being now knows, the Internal Revenue Service (IRS) has apparently been selective when it comes to the entities its agents scrutinize. Tea Party groups in particular (organizations known to be less sympathetic toward the IRS) seem to have generated abnormal amounts of attention from it.

Let it be said up front that the IRS's presumed misdeeds are indeed offensive, but let's not be so facile as to call what happened a scandal. If so, then it's certainly the case that human nature is scandalous.

That is so because bias is a human condition. Conservatives sometimes complain about ‘liberal media bias,' and while the latter is a reality, the complaining has never made sense. Those who swing left tend to gravitate toward the media, so it's only natural that media coverage of just about anything will reveal itself in slanted ways.

Unless we're truly bland, and probably on all sorts of anti-depressants such that we're totally devoid of emotion, our views and emotions are going to color how we do things, how we present stories to others, and applied to the IRS, whom we investigate. Thinking about the IRS non-scandal, it would only be a real story if the IRS weren't investigating its presumed enemies.

As James Bovard put it in a Wall Street Journal op-ed earlier this week, a politicized IRS has been the norm since at least the 1930s. To presume otherwise is naïve, so while it's perhaps good politics for President Obama's opponents to be political about the IRS's revolting doings, any righteous indignation seems overdone. Any government entity is going to be political, and because the latter is true, it's hard to assign scandal to what the IRS was doing.

It seems the better answer is to acknowledge what's more of a certainty, that the IRS itself is the scandal. Not asked enough before and after the news about our tax authority is how a nation uniquely founded on skepticism about politicians and government could have ever created something like the IRS.

The Founders created the federal government, then proceeded to grant it very few rights; most of those related to our allowing the feds to protect our right as individuals to live as we want. And while its meaning has been totally perverted in modern times, even the General Welfare clause was written to ensure not an expansive government, but to rein in the political class any time its use of the limited powers granted to it weighed on our rights as individuals.

Back to the IRS, the brilliant concept that is the United States, one founded on the belief that governments by nature are not to be trusted, has allowed for the rise of an entity that allots for itself an obnoxious portion of our paychecks. More hurl inducing is the sad reality that we must prove our income to this unelected tax authority.

The ‘revelation' of a politicized IRS brings new meaning to ‘blinding glimpse of the obvious.' The bigger scandal is that once a year we do our taxes fearful that an accounting error could have us in serious trouble with our nation's tax authority, and more broadly, with the law. That's why we must scrap the income tax code altogether and institute a national sales tax.

Though our federal government's role should be naturally limited so that we as individuals can choose large or small government based on the state we live in, the federal government is empowered to protect us from foreign intruders, coin a currency, and required to protect our rights to live as we want. Since there's a cost involved, there should be a very low national sales tax instituted so that a limited federal government can carry out its very limited powers.

A national sales tax would mean we no longer need to act as subjects cowering in fear of a tax authority, and because we won't, we'll no longer have to prove to the very federal officials whose salaries we pay how much we earn. Importantly, when we have a bad year so will the federal government as our consumption will decline. And if we find at times that we're unhappy with what the federal government's doing, a national sales tax would allow us to register our disappointment by consuming less so that the feds take in less. Good.

Some might reply that a flat tax is the answer to a corrupted IRS. It would surely be an improvement on a tax code that presumes to control how we live, but a flat tax by its very nature means we'll have to continue bowing before our federal minders once a year as we prove our income to them. It also ensures big government as far as the eye can see.

That's the case because Americans are the most productive people on earth. Because they are they annually produce a great deal of taxable income. A flat tax, though not as stimulative as a national sales tax, would be a massive boost to economic growth, and as such would lead to massively increased federal revenues. In short, the flat tax would arguably be too successful as a source of federal revenue, and because it would be, it's not consistent with limiting the size of government. And it doesn't presume the abolition of the IRS.

Back once again to the non-scandal, did readers really expect anything different? Can any reader honestly say that if in power at the IRS that their experiences, biases and ideology wouldn't color whom they would scrutinize? Not very likely.

The problem is not the redundancy that is the ‘politicized IRS;' rather the problem is that the IRS exists to begin with. It's time that we abolish our tax authority with a view toward re-asserting our individual liberty.

John Tamny is editor of RealClearMarkets, Political Economy editor at Forbes, a Senior Fellow in Economics at Reason Foundation, and a senior economic adviser to Toreador Research and Trading ( He's the author of Who Needs the Fed?: What Taylor Swift, Uber and Robots Tell Us About Money, Credit, and Why We Should Abolish America's Central Bank (Encounter Books, 2016), along with Popular Economics: What the Rolling Stones, Downton Abbey, and LeBron James Can Teach You About Economics (Regnery, 2015). 

Show commentsHide Comments

Related Articles