The Paris based Organization for Economic Cooperation and Development released a report today that stated the tax burden of workers in Western nations rose in 2010. According to the report, 22 nations that are part of their group, which includes the US, experienced an increase in their tax and social security payroll deductions. This is the first increase the O.E.C.D. has seen in years.
The O.E.C.D. warns that such increases in taxes could slow economic growth. The tax deducted from workers all over the globe is reducing expendable income. The O.E.C.D also stated that tax increase could lead to a reduced involvement in the work force and more unemployment.
They suggest government revenue should be generated by indirect taxes and eliminating tax loopholes. The loopholes in the tax code are often exploited by large corporations that can afford to hire accountants.
Reuters reported that people when faced with higher taxes will take measures to avoid paying higher tax rates. The tax code has been revised so much over the past decade that the many different loopholes make it easier to avoid tax bills.
The ambiguity of the tax code along with an increasing tax burden can make people reluctant to pay or simply refuse to pay. Whether a person avoids their taxes directly or indirectly they may eventually find retaining a tax attorney becomes a necessity. When person or business can’t pay their tax bill, the IRS will add staggering fines and penalties that a tax lawyer can work towards reducing.
