6.1 billion man-hours. That’s approximately the amount of time consumed by 3 million full-time workers over the course of a year. 6.1 billion hours also happens to be the amount of time eaten up by tax compliance each year, and that figure doesn’t even include the additional hours that taxpayers and businesses spend responding to IRS notices and audits.
$163 billion dollars. That’s the approximate cost in actual dollars (the figure doesn’t include the opportunity cost of the 6.1 billion hours) that American taxpayers and businesses spend each year on the process of filing their taxes. According to the Taxpayer Advocate Service (whence these other facts and figures come), $163 billion is about 11 percent of aggregate income tax receipts. Or another perverse way of looking at this $163 billion is as a tax on taxation.
4,428. That’s the number of changes to the tax code in the past ten years (TAS estimates an average of over one change per day). 579 of those changes happened in 2010 alone.
3.8 million words. Here’s a scary thought: No one knows exactly how long the tax code actually is, but according to TAS’s best estimate, it includes about 3.8 million words.
6.1 billion man-hours + $163 billion dollars + 1 change to the tax code per day + 3.8 million words equals one enormous pile of waste and inefficiency.
But don’t look at it in such a negative light, urges Caterine Rampell at the New York Times, because inefficiency isn’t bad for everyone.
Much of that $258 spent annually by the typical taxpayer to comply with the tax code ends up as a salary for a tax preparer (or some tax preparation software-coder’s). As my father — one of the many accountants in my lineage — likes to say, he is always grateful that Congress has chosen to take pity on the nation’s poor accountants by guaranteeing them employment for life.
In other words, in tax preparation as in so many other industries, businesses and their employees can benefit from government-instigated inefficiencies.
You, ma'am, had best get your finger out of my eye.