Why Don't We Just Send All Our Money to the Government?

When it comes to high taxes, people have often joked that we may as well just send our paychecks in to the government, and they can tell us how much we should get back.  Well, in the United Kingdom, they may well opt for that system.  Britain’s tax authority is proposing that all employers send employee paychecks directly to the government.  The government would send what it deems appropriate to the employee, and keep the rest.  See, Wright, Robin, "UK Proposes All Paychecks Go to the State First," http://www.cnbc.com/id/39265847 (September 20, 2010).

The implications of this system are breathtaking to contemplate. It is somewhat disturbing to have the government act as a clearinghouse for income, having de facto power to simply retain all income for public use, if it perceived the need.  In addition, however, the state would also have the complete knowledge of all job-related incomes across the board, and be able to determine if people are being paid what the government deems fair.  On the bright side, this might eliminate the need to file tax returns.

For my American friends, this kind of thing may be closer to you than you think.  What happens across the pond is usually only a few years ahead of what happens in the States.  Cheerio!