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WHAT DO TAXPAYERS THINK ABOUT THEIR TAX BILLS?
The US IRS Oversight Board has recently released its annual Taxpayer Attitude Survey. The Oversight Board was set up some years ago by Congress when there was a concern that the IRS was abusing its powers. Its role is to look for ways to protect taxpayers from such excesses. The Taxpayer Attitude Survey asks some interesting questions and produces some fascinating answers. The statistics are given for the last 8 years so it is possible to see how attitudes have changed.
In 2003, 17% of taxpayers thought it acceptable to cheat on their income taxes, 5% as much as possible and 12% a little here and there. In 2010, only 8% thought it acceptable to cheat a little here and there but the as much as possible figure remained fairly constant throughout the 8 years. 87% of Americans feel it unacceptable to cheat on their income tax. However when this is broken down, only 69% agree that it is every American’s civic duty to pay their fair share of taxes although another 28% mostly agree with that statement. The 10% difference presumably feel that other people ought pay their fair share! Curiously when taxpayers were asked whether they should just have to pay what they feel is a fair amount of tax, 10% felt they should and another 17% mostly agreed with that statement. So 87% feel cheating is wrong but only 73% feel that they ought to pay what Congress decides! When asked whether taxpayers have a personal responsibility to report anyone who cheats on their taxes, 35% thought they did not.
When asked how important it is to taxpayers that the IRS takes steps to ensure that all taxpayers pay what they owe, 83% thought it important that the IRS chase low-income taxpayers, 95% thought it important they chase small businesses, 95% wanted them to chase high-income taxpayers and 98% felt it important that the IRS cracks down on companies.
When asked what influences taxpayers to report honestly, 64% were largely influenced by fear of an audit, 34% by a belief that other taxpayers were reporting honestly, 66% by the knowledge that third parties were reporting the income to the IRS and 92% by their personal integrity. Curiously 6% said they were very little influenced by their personal integrity and 2% did not know whether this influenced them or not!
Taxpayers were also asked what the IRS should do to help them get their tax right. Roughly 80% felt a toll-free telephone helpline was very important although less than 60% said they would use such a helpline. Similarly with the IRS website, around 70% thought it important that the website provides information but only about 52% said they would actually use it.
A statistic I find astounding is when asked how long people would be prepared to hang on the telephone to wait to speak to an Officer, 46% said up to 5 minutes, another 27% said 6 to 10 minutes and a further 24% said 11 to 30 minutes. 2% were prepared to hang on for up to one hour and 1% for over an hour. I find it hard to imagine that UK taxpayers would be so tolerant.
38% of taxpayers were very satisfied with their interactions with the IRS and another 39% fairly satisfied. However 32% felt that the IRS devotes too much of its resources to enforcement and not enough to customer service. 58% felt that the IRS ought to receive extra funding for enforcement activities and 61% felt it ought to receive extra funding to assist more taxpayers over the phone or in person.
From 1 January 2011, it is illegal for anyone to be paid to assist with the preparation of a Federal Tax Return without being registered with the IRS – and from the middle of the year, it is necessary to pass an IRS competency test and meet continuing professional education requirements in order to obtain such registration. Taxpayers were asked whether it was important that tax return preparers be required to meet standards of competency. 75% felt this very important, 19% somewhat important and a surprising 6% unimportant. However 79% felt it important that tax return preparers be required to meet ethical standards and a further 15% felt this somewhat important.
It would be interesting to know how the UK figures would compare with the US ones. I suspect that the figures for taxpayer honesty would be fairly similar albeit that in the UK there is far less third party reporting. I am sure UK taxpayers will be far less willing than the US counterparts to wait for their phone call to be answered.
ROBERT MAAS
WHAT DO TAXPAYERS THINK ABOUT THEIR TAX BILLS?
The US IRS Oversight Board has recently released its annual Taxpayer Attitude Survey. The Oversight Board was set up some years ago by Congress when there was a concern that the IRS was abusing its powers. Its role is to look for ways to protect taxpayers from such excesses. The Taxpayer Attitude Survey asks some interesting questions and produces some fascinating answers. The statistics are given for the last 8 years so it is possible to see how attitudes have changed.
In 2003, 17% of taxpayers thought it acceptable to cheat on their income taxes, 5% as much as possible and 12% a little here and there. In 2010, only 8% thought it acceptable to cheat a little here and there but the as much as possible figure remained fairly constant throughout the 8 years. 87% of Americans feel it unacceptable to cheat on their income tax. However when this is broken down, only 69% agree that it is every American’s civic duty to pay their fair share of taxes although another 28% mostly agree with that statement. The 10% difference presumably feel that other people ought pay their fair share! Curiously when taxpayers were asked whether they should just have to pay what they feel is a fair amount of tax, 10% felt they should and another 17% mostly agreed with that statement. So 87% feel cheating is wrong but only 73% feel that they ought to pay what Congress decides! When asked whether taxpayers have a personal responsibility to report anyone who cheats on their taxes, 35% thought they did not.
When asked how important it is to taxpayers that the IRS takes steps to ensure that all taxpayers pay what they owe, 83% thought it important that the IRS chase low-income taxpayers, 95% thought it important they chase small businesses, 95% wanted them to chase high-income taxpayers and 98% felt it important that the IRS cracks down on companies.
When asked what influences taxpayers to report honestly, 64% were largely influenced by fear of an audit, 34% by a belief that other taxpayers were reporting honestly, 66% by the knowledge that third parties were reporting the income to the IRS and 92% by their personal integrity. Curiously 6% said they were very little influenced by their personal integrity and 2% did not know whether this influenced them or not!
Taxpayers were also asked what the IRS should do to help them get their tax right. Roughly 80% felt a toll-free telephone helpline was very important although less than 60% said they would use such a helpline. Similarly with the IRS website, around 70% thought it important that the website provides information but only about 52% said they would actually use it.
A statistic I find astounding is when asked how long people would be prepared to hang on the telephone to wait to speak to an Officer, 46% said up to 5 minutes, another 27% said 6 to 10 minutes and a further 24% said 11 to 30 minutes. 2% were prepared to hang on for up to one hour and 1% for over an hour. I find it hard to imagine that UK taxpayers would be so tolerant.
38% of taxpayers were very satisfied with their interactions with the IRS and another 39% fairly satisfied. However 32% felt that the IRS devotes too much of its resources to enforcement and not enough to customer service. 58% felt that the IRS ought to receive extra funding for enforcement activities and 61% felt it ought to receive extra funding to assist more taxpayers over the phone or in person.
From 1 January 2011, it is illegal for anyone to be paid to assist with the preparation of a Federal Tax Return without being registered with the IRS – and from the middle of the year, it is necessary to pass an IRS competency test and meet continuing professional education requirements in order to obtain such registration. Taxpayers were asked whether it was important that tax return preparers be required to meet standards of competency. 75% felt this very important, 19% somewhat important and a surprising 6% unimportant. However 79% felt it important that tax return preparers be required to meet ethical standards and a further 15% felt this somewhat important.
It would be interesting to know how the UK figures would compare with the US ones. I suspect that the figures for taxpayer honesty would be fairly similar albeit that in the UK there is far less third party reporting. I am sure UK taxpayers will be far less willing than the US counterparts to wait for their phone call to be answered.
ROBERT MAAS
posted by CBW at 9:29 am
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