Taxes’ critical role in times of crisis

March 22, 2020
COVID-19 drive through testing stations

National Guard troops have been deployed to help states meet COVID-19 needs, ranging from personal protective equipment training, support of medical testing facilities and healthcare professionals and assisting with disinfecting and cleaning common public spaces. (Photo courtesy U.S. Department of Defense)

Taxes have been in the public spotlight this week, not because right about now we normally would be nearing the annual filing deadline, but because of how the coronavirus pandemic has thrown normal, including our tax obligations, out the window.

By now you know that April 15 is not Tax Day this year. Instead, it's been pushed to July 15.

If you owe taxes, that means that instead of sending that money to the Internal Revenue Service with your tax return, you get to hang onto it for three more months. The hope is, although I think it's slim, that by mid-summer things will be better and folks will be more able to pay their tax bills.

Even in the best circumstances, taxes rarely are fun. They definitely aren't fun in trying times like a deadly global pandemic.

But especially in crisis situations, taxes are necessary. Or, as Supreme Court Justice Oliver Wendell Holmes, Jr. famously said way back in the early 20th century, "Taxes are what we pay for a civilized society."

The value of taxes: That tax truism is the subject of this week's Sunday Shout Out — Joseph Thorndike's column on Americans Are Getting A Hard Lesson In Why Government — And Taxes — Actually Matter.

Thorndike, a historian and columnist and blogger for Tax Notes, looks at the anti-tax movement that over the last 20 years has been dedicated to dramatically and drastically reducing the size of the federal government.

The argument to continually cut or eliminate taxes and shrink government services and oversight as much as possible has been an easy sale to many policy makers and much of the general public.

However, this coronapocolypse, which could forever alter our lives, also might change tax policy perspectives. Or, as Thorndike writes in his column published by Forbes:

     "The coronavirus pandemic has thrown the spotlight on this slow-moving but destructive development in American government. As the nation confronts the huge demands of trying to arrest the pandemic’s spread, the weakness of crucial agencies and institutions is increasingly evident. We have underinvested in things that don’t matter every day but matter enormously when the stakes are very high.

     It seems quite possible that Americans will emerge from the current crisis with a newfound appreciation for many of the things that government must do — and a keen sense of what happens when it doesn’t do those things or doesn’t do them well."

It takes a tax-supported village: I've been involved in tax legislation on the professional side of my life for almost as long as I've been paying my individual taxes. I totally understand how frustrating tax laws are and how they usually get more convoluted every time Congress messes with them.

I also understand and sometimes share the anger and frustration of suddenly being hit with an unexpectedly high tax bill, at federal and more local government levels.

But taxes truly are the price of enjoying the type of society we all share.

We need to ask ourselves now and after this pandemic is under control what government services we are willing to sacrifice for a lower tax bill?  We also must answer how much we are willing to pay to ensure that our neighbors — and not just those who live next door, but also those struggling in other neighborhoods and communities — also can enjoy necessary programs that make our city, state and national societies safe, strong and productive.

That's a tax topic I've explored many times here on the ol' blog over the years, going all the way back to my 2008 post on the good side of taxes.

Thorndike thinks that Americans may emerge from the coronavirus pandemic wanting bigger and more active government, and with more of an acceptance of the taxes used to pay for its spending.

I'd settle right now simply for some acknowledgement that we all are part of something larger and that in bad and good times, it takes a national and tax-supported village to survive and move forward.

 

Coronavirus Caveat & More Information
In 2020, we're all dealing with extraordinary circumstances,
both in our daily lives and when it comes to our taxes.
The COVID-19 pandemic and efforts to reduce its transmission
and protect ourselves and our families means that,
for the most part, we're focusing on just getting through these trying days.

But life as we knew it before the coronavirus will return,
along with our mundane tax matters.
Here's hoping that happens soon!
In the meantime, you can find more on the virus and its effects on our taxes
by clicking Coronavirus (COVID-19) and Taxes.

 

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Comments
  • Thanks, Rates. I’m glad you enjoyed it. Kay

  • It’s an awesome article ,”taxes are what we pay for a CIVILISED SOCIETY “ especially during this pandemic situation.wonderfulwork!

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