The Income Tax and Due Process by Rep. Phil Hart
Monday, January 23, 2012, we had a bill on the House floor (House Bill 362) that would strike the current statutory requirement that the Idaho State Tax Commission must notify a taxpayer by certified mail when the Tax Commission has issued them a Notice of Deficiency. If the taxpayer disagrees with the findings of the Tax Commission, there is a statutory requirement that the taxpayer has 63 days to object to the findings of the Tax Commission. The 63 day period begins when the notice is mailed. House Bill 362 would allow this notice to be mailed by first class mail. The argument behind this legislation is that there would be a savings to the Tax Commission of $200,000, and that there would be fewer articles of mail returned to the Tax Commission as unclaimed.
We had nearly an identical bill in 2007 (HB 8) which passed both houses of the legislature with little opposition, but was vetoed by the Governor. I voted in favor of the 2007 bill, although in hindsight I regret having done so. However, this year, with a clear conscience, I voted against HB 362, when we considered it on the House floor.
In 2007 Governor Otter did the right thing when he vetoed House Bill 8. In his letter of explanation, the Governor wrote,
“I strongly encourage saving tax dollars and achieving cost savings within state government, however, this specific cost savings is minimal and inappropriate compared with the potential costs to property owners across Idaho.
Idaho has a long tradition of protecting and promoting private property rights. The Idaho Constitution sets forth the inalienable right to acquire, possess and protect property. This right is paramount to a free and prosperous society. To that end, there are many processes established under state law to protect property and an owner’s interest in it.
Title 63, Section 3061A of the Idaho Code is no exception…. Notice in these situations is critical for property owners to defend any rights or interests in their property, and using certified mail provides greater assurance that notice is actually received.”
Governor Otter was right in 2007 when he vetoed House Bill 8, and I was wrong when I had voted in favor of that bill. Our Declaration of Independence states that the purpose of government is to secure our rights. And when we, as a government, are going to take someone’s life, their liberty or their property, due process requires that the procedure begins with “notice.”
Look up “due process” in a legal dictionary and you’ll discover the term is largely undefined, yet it needs to be “reasonable.” Taking someone’s property, and notifying them you’re going to do so by first class mail in my mind is unreasonable.
If we are trying to save money, as the Statement of Purpose of HB362 claims, maybe we should junk the entire income tax instead of trying to tweak it to make it better. For the taxpayer, it costs 22 cents to develop and keep the financial records necessary in order to pay $1 in income tax. The income tax is the most inefficient tax we have. However a sales tax only takes about one cent in record keeping effort for every $1 paid in sales tax. The income tax requires all of us to be a witness against ourselves, in violation of our Fifth Amendment rights. To get around this, the courts completely distort the application of the Fifth Amendment.
Will Rogers said, “The income tax has made more liars out of the American people than golf has.”
Reporting on my Monday’s “no” vote on HB362, reporter Betsy Russell of the Spokesmen Review and the Eye on Boise blog continues to lie about my court case with the State Tax Commission. All the back taxes related to my case have been paid, including all penalties and interest. What is at question now is the trumped up “taxable income” that was created when the IRS, illegally, denied all of my business deductions for eight years. As an engineer in private practice, the IRS did not allow me to deduct the cost of a single postage stamp, paperclip, or work mile driven for 8 years. When these deductions were denied, my so-called “income” skyrocketed.
I earned an MBA and did learn a thing or two about running an efficient business. But even my alma matter, The Wharton School of Business at the University of Pennsylvania, America’s #1 business school, was not able to teach me how to run a business for eight years without incurring a single dollar in expenses.
Depriving me of my rightful business deductions for eight years was political payback for having refused to turn over to the IRS the names, address and phone numbers of the people who bought a book I authored about the income tax (a book, by the way, that remains unchallenged as to the accuracy and completeness of the history of the income tax). My refusal to turn over the names of the purchasers of my book was morally and legally necessary to protect their First Amendment rights to Freedom of Speech. And my “no” vote on HB362 was made in an effort to defend Idahoan’s Fifth Amendment rights to Due Process.
All around us we see the crumbling of our institutions caused by socialism, the overreach of big government and collapsing societal structures that were propped up by debt – financed with money created out of thin air! If we are going to pull out of our economic mess, we are going to have to get leaner. We must rid our society of our most inefficient tax, the income tax – a necessity if we are going to restore the prosperity we once knew.