Would it be possible for people to choose where their taxes go?

Great Debates
1

Would it be possible to offer people the option when they fill out their tax forms to designate where their tax dollars go. An accountant friend mentioned it to me as a way to make people who complain about paying taxes more willing to pay, and, to me, it sounds like exactly the sort of behavioral economics strategies that Obama advisors Goolsbee, Sunstein, Thaler, et al like.

If people had the option to choose where their taxes go, there would be a lot less complaining from conservatives who believe that their taxes should only go to defense (that’s just an example), or a liberal might be able to refuse to allow his money to go to defense and opt to send their taxes to education.

In order to make so that everyone didn’t opt to do this, there would have to be some way to make so only those who are really adamant about where their taxes go would opt to do it. It wouldn’t be a question on the form, for example, but rather a note that says, “If you wish to choose where your tax money goes, go to this website, print out so-and-so form and attach it to your tax form.” This way, very few people would probably do it, but those who are very concerned about where their tax dollars go would surely do it and probably get some piece of mind from it.

Another plus side to this, it seems, is if all of statistics are published on a site like data.gov and we could see the trends or tendancies of the American tax payers, it could open up a debate about certain programs. Tax season might become a time to really discuss different aspects of the government and the merits of funding them because people can actually have more of a direct say in how they’re funded.

Now, I know this will do nothing to address the fact that a lot of people don’t want to pay taxes because they want to keep they’re money, but they’re are still a lot of folks who would mind a lot less if they knew their money was going to something they believed in.

2

I think a lot of people would do this, maybe a majority, unless you made it a huge pain in the ass. I know I certainly would. And it would be a disaster. Sure, the military would get some funding, so would some social programs, and highways, and maybe education would get a boost. But it would be the most ridiculous way to fund the government ever. How many people would op to fund the hundreds of anonymous but necessary programs whose missions are so abstract that they’re not easily understood? Think many people are going to step up and decide they want to fund the federal court of appeals? How about consular services?

The whole point of representational government is to put people in charge when the system gets too complicated for direct democracy. We’re definitely way, way past that point.

3

Choose? Choose between what? Everyone’s tax money already goes to the same place - the IRS.

4

Don’t we already have that choice in the form of voting for representatives?

5

There’s a fine line that has to be walked, here. If everyone got to choose exactly where all their taxes go, then a lot of boring but nonetheless essential programs would end up going unfunded. Nobody’s going to assign their tax money to pay the salary of a part-time assistant congressional page, but those pages do valuable work, and their pay has to come from somewhere. The solution to this would be to ensure that some portion of tax money (either from some portion of taxpayers, or some portion of each taxpayer’s tax) goes into a general fund, which the government accountants could put wherever it’s needed, to fill in those odd jobs and expenses people don’t think about.

On the other hand, if that general fund is too large, then you’d end up with the situation the United Way has, where there’s the illusion of control of where your money goes, but it doesn’t actually make any difference: The politicians and accountants decide how much every governmental program will be budgeted, all of the taxpayer-allocated funds would be written down for their various programs, and the general fund would be split up according to how much each program needed to reach their predecided budget.

6

+1. If you don’t like where your taxes go, vote for people who will, in turn, vote for where you want them to go.

7

I’ve thought about this, and here’s my thinking.

First, folks don’t get one vote per dollar of taxes: it’d be unfair to let the wealthiest people decide where tax dollars go to that degree. One vote per person.

Second, you’ve got to mention all areas of the budget on the form, or else people will neglect the boring-but-necessary programs. My thinking is that the budget should be divided into, say, 10-20 different areas that cover 100% of federal spending.

Third, you’ve got to give Congress a chance to work with what they get: say, give them a 2-year lead time. On next year’s taxes, you’ll tell Congress how to allocate the 2012 budget. Or maybe average the results of 3 years, so that a scandal in one year doesn’t decimate, say, the EPA. For the 2015 budget, Congress will average the results of the 2011, 2012, 2013 survey results.

Fourth, you’ve got to have room for emergency spending: this is an annual vote, and there may be a need for, say, immediate spending on NASA to blow up an asteroid or whatever. You could require a 2/3 vote of Congress to override the tax-survey results, with the vote on record, to prevent any shenanigans.

With that said, each person would have the option of filling out the last page of the tax return, in which they put a number from 0 to 100 beside each of the 10-20 different funding areas of government. If their sum of their numbers isn’t 100, their results are invalidated. If they are, their results are averaged with those of everyone else’s results to provide guidance to Congress on how the federal revenue should be spent.

8

Maybe you could/should pay EXTRA to make sure it DIDNT go to where you DIDNT want it to.

Don’t want your dollar to go to those baby killers in the DOD?

Fine, give us a dollar and fifty cents, and your tax dollars go somewhere else.

IMO that would solve some of the implimentation problems.

9

As other posters stated, alot of programs would go unfunded because people don’t know or care about them. Also you have the added cost of going through all these returns, and figure out how much is going where. What if nobody wants to fund the IRS?

It might be more workable if you specified that you could determine where 1% of your tax would go. Congress would dish out 99% of the taxes to the budgets, and the last 1% would be decided by the tax payers. Of course we would need to reduce spending to match the new 99% tax income. Then whoever gets your 1% would be able to use it to extend services, or whatever over what they were budgeted for.

-Otanx

10

It would probably cost at least 1% to administer the program. Make it 50%. The government gets to choose where that 50% goes, and if it wants more, then they can include a box on the form to ask for a portion of your 50% to top their discretionary fund.

11

This. That’s why we have elections for congressional representatives every two years. As the term implies, they REPRESENT us. Their votes (theoretically) reflect how a majority of us would vote. What the OP asks for is already built into the system.

12

and what happens if an agency gets more votes than it actually needs? Gold faucets in the restrooms? Big raise for the agency chief?

13

In my opinion, a good part of the fiscal mess that California now finds itself in is due to elected representatives not being allowed to make tough choices on complex problems because their options have been removed by California voters who thought they could collectively better decide where money ought to go and where it ought to come from.

Now, one could say that allowing voters to pass unwise and contradictory ballot measures is different from giving individuals a chance to say where their tax dollars should go, but I see it as two ways of creating the same problem: underinformed people making important decisions. It’s just a bad idea.

14

Exactly–and this is why I don’t donate to the United Way. (Instead, I donate directly to the charities I support.)

Money is fungible. For the situation the OP describes, in which only a few people are directing where their tax dollars go, such action is basically irrelevant. If someone designates that all of their tax dollars should go to the EPA (and none to the DOD), other taxpayers’ undesignated funds make up any shortfall or overallocation to what was originally budgeted.

15

There was a book on this premise. I wish I could recall the name or author, but it is lost in the past.

The idea was the everyone could assign up to 90% of their income taxes, in 10% increments, to certain categories of expenses like health care, education, etc. So you could give 10% to one thing, 30% to another, etc.

The government could spend 10% any way it wanted.

16

I saw a study where they took groups of people and had them allocate money as they saw fit (just as an excercise). In general fire, police, schools, and parks did much better than they do now.

17

I’ll support people being able to choose where their tax dollars go as soon as they also lose any benefits from things they didn’t support.

18

That means its susceptible to mildew, right? :wink:

19

Would you be willing to say that those who don’t pay any taxes at all shouldn’t get the benefit of things they don’t support, too?

20

If I may jump in, it sounds like the position being taken is that if you make a decision not to contribute to a certain program, you shouldn’t also benefit from the program.

Not making enough income to pay taxes at all is a different kettle of fish. It’s pretty much the opposite of saying that those who pay more taxes should get, say, special access to roads that only rich people can use.