Proof that Americans don’t understand how taxes work

Posted on April 19, 2006 | Filed Under Editorial

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Ask most Americans how much they paid in taxes last year and you’ll either get a blank stare or an answer somewhere along the lines of, “I didn’t pay any taxes, I got a refund.” Now, I see more proof that the majority of our citizens are oblivious to how taxes work in this country.

The current media fixation seems to be on the $1.9 million refund that Dick Cheney received. The outrage! Oh, the humanity!

Paaahlease, People! Anyone with an ounce of reason and comprehension understands that a refund is money that you overpaid in taxes during the tax year (either through withholding or through quarterly payments). You are just getting back your own money that you paid in excess of what you owed. Interestingly enough, I have yet to see anyone mention that by overpaying his taxes by $1.9 million, he missed out on nearly a year of interest on that money. Somehow, I guess people feel better about themselves when they complain about someone else’s ability to achieve.

By the way, you do know how to solve the withholding/overpaying conundrum, don’t you? The Fair Tax would be a good start.