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Tax Freedom Day

In The Next Step, I write about how there should be more days where governments suspend tax collection, as they do for back-to-school periods (usually done by state and local governments in the U.S.). I think it would be extremely beneficial if more of this happened at other times of the year, and not just at the local and state level. Non-tax revenue usage should be increased to replace what is suspended.


That being said, when I first heard of Tax Freedom Day, I thought this was a description of what I just recommended.


It's not.


In case you are not sure, Tax Freedom Day is something that happens once per year, whereas it is a date that is determined to be when taxpayers have fully paid their government's tax bill for the whole year. It's based on all the money the nation, as a whole, has made up to that time. In other words, it's the first day that a person starts earning money just for themselves and not for the government at all, though taxation is structured to take money all year long. Dozens of nations celebrate this glorious day, and rightfully so. When a period of time can be framed that represents just how much government is forcing from you and how much you work/make to provide for that, it paints and eye-opening picture.


For the U.S., Tax Freedom Day came on April 16, 2019, according to the Tax Foundation. Although, the Adam Smith Institute says it was May 30, 2019. That might not seem bad to some people, since it's not even halfway through the year. But, considering we are talking about each, and every day until April 16 (worse, if it's May 30th), that's a lot of days of your life dedicated to nothing but paying for government. That's a perspective which should be taken seriously. Depending on what nation someone is in, Tax Freedom Day comes at different times, since taxation is at different levels. This year, for example, in Austria, it's August 05, 2019! That's insane. The majority of the year, everyone there works just to pay for government.


As if that's not bad enough, remember that we are only talking about government revenue, not government debt. What governments make and what they owe are usually two different numbers, which puts future generations on the hook for a lot of days working toward this fabled Tax Freedom Day.


Here's a radical idea: Start developing more non-tax alternatives, put them into action, fix the ones that are broken now, and slowly phase out one tax after another. Non-tax revenue has the ability to become the engine that puts a real Tax Freedom Day closer and closer to Jan 01.







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