It Just No Longer Adds Up

TAXES

IT was Taxpayers Eve, gloomiest night of the year. As last-minute taxpayers trudged morosely to post offices to send off their returns, they were surprised to bump into federal bureaucrats who had come out to greet them with smiles, coffee and doughnuts. The friendly feds thanked each taxpayer profusely for helping to keep them in business. Bowled over by this display of bureaucratic concern, the taxpayer went home with a feeling of gratitude toward a government that so obviously cares.

The dreamer of this unlikely dream is James H. Boren, president of the tongue-in-cheek National Association of Professional Bureaucrats. This week the Government might well take his advice. For never have Americans seemed more reluctant to pay their taxes--or to pay enough. After scrutinizing returns last week, Treasury Secretary John Connally, exploded in outrage over the ways in which taxpayers were cheating the Government out of money rightfully owed. He promised "maybe millions" of audits, and ordered some 15,000 IRS employees to help people figure out the tax forms, which are so complicated that one study estimates that only a college graduate can completely understand them.

Breaks. Confusion was part of the picture, but there is little doubt that U.S. taxpayers, who are among the most compliant in the world, are in near revolt against a system that practically no one still defends. More loophole than law, it allows many big taxpayers to escape scot-free while it grinds ever more out of the small taxpayers. Some tax breaks, it is true, serve as useful economic incentives, but in the past few years federal income taxes on corporations have been slashed more than can be justified. Federal income taxes for individuals have been reduced, too, but in the meantime the Middle American has been burdened with soaring property, Social Security and sales taxes--all of them, regressive.

Tax reform is fast becoming the 1972 campaign's top political issue. George McGovern won the Wisconsin primary in part by never letting up in his attacks on the tax structure, and George Wallace pulled an impressive number of votes with much the same tactic. There is even speculation in Washington that the President may call a special session of Congress in late summer or early fall to offer some reform and take the issue away from the Democrats. After getting around the country a bit in the primaries, John Lindsay advised: "What someone ought to do is organize a nationwide grassroots campaign for a total tax restructuring in this country by 1976, the bicentennial. Whoever does, will have a great political future."

But the voters are not waiting for the politicians on the issue; they are out ahead and dragging the candidates along with them. No. 1 target of their wrath is the property tax. In Chicago, a group called Citizens' Action Program is pressuring the state general assembly to impose a tax freeze in Illinois; it is hoped that the move will become a rallying point for the taxpayers. "The crisis has come," says Robert Creamer, CAP coordinator. "The solution now is to quit tinkering with the system. We've got to use a meat cleaver instead."

Out on the farms in Wisconsin, pitchforks are swinging. Embattled farmers have led a revolt that has withheld some $1.5 billion in property taxes. "We have what we call around here a windshield assessment," complains William H. Wanek, a farmer who owns 527 acres that are taxed more each year while his income stays the same. "Some guy drives along the road and looks at our farms through his car windshield and your taxes go up." Wanek feels that the Federal Government is mostly to blame, but it is out of reach. The state government is near by. "A fellow figures he can slow it down a little."

Defiant Yankee. Spunky rebels are even willing to take on the Government singlehanded. A case in point, is John Wright, 85, a retired Congregational minister who is determined to hold on to his 80 acres of farm and forest in Merrimack, N.H. His fixed income does not even amount to half his property taxes, so he refuses to pay them. "There are many men here who earn five or ten times as much as I do," says the defiant Yankee, "but they don't pay a cent in taxes. Every man should pay according to his income, not his property."

Many politicians are scrambling to save their jobs. Responding to constituents' pressure, Washington Governor, Dan Evans, just completed a county-by-county tour of the state to listen to gripes about taxes. "People are adamant about constitutional limits on taxation," he says, "because they don't trust the legislature--and I know they are also thinking, 'That goes for the Governor, too.' " Oregon's Republican Governor, Tom McCall, announced last week that tax reform is so urgent that he will even help Democrats get re-elected to the legislature if they will support his program.

Out on the primary trail, the presidential candidates are playing up a tax-reform bill authored by Wisconsin Senator, Gaylord Nelson and cosponsored by Candidates Humphrey, Muskie, and McGovern. Depending on which candidate is speaking, it is either the "Nelson-Humphrey" bill, the "Nelson-Muskie" bill, or the "Nelson-McGovern" bill. Considering the mood of the voters, it may soon become the Nelson-everybody bill.

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