Now and then clients or friends will ask me if I fear various proposals to simplify the tax system, such as a nationwide sales tax. They ask if I’m afraid of becoming obsolete because of a “simplified” tax system.
My answer is always “no,” for several reasons.
One, it’s disingenuous for politicians to say things like “my proposal for a nationwide sales tax will eliminate the IRS!!!!”
There will always be a tax system of some sort, and that means there will always be a government agency overseeing that tax system.
Even something that’s supposedly “simple” like a sales tax or flat tax will have layers of complexity that will need to be navigated. This means there will always be conflicts between citizens and the government, and therefore a need for someone to serve as an advocate for the citizen in those disputes.
Two, even if we lived in a utopia where there were no taxes at all, businesses would still need accounting help. For example, businesses wanting to get a loan from a bank would still need to provide financial info to the bank.
It would be a major change for accounting firms to move away from tax preparation into just doing financial statements, business consulting, etc. But it’s a survivable change.
Join the discussion and tell us your opinion.
Jason, I actually got involved in a LinkedIn discussion about this very topic, what’s interesting is that I got pushback from people who didn’t know what the term “deductible” entailed as it relates to inputting the info on the appropriate tax return(s).
Jason, I’m not sure whether to laugh or to cry over that. But one thing is for certain, it doesn’t surprise me. :/