H&R Block Snuffs Tax Efficiency

If your mind has folded in on itself like a Chinese Puzzle Box trying to grok the convolution of this year’s tax forms, we have good news: the IRS bureaucracy wants to make the process as efficient as possible. Unfortunately, the guys you pay to do your taxes don’t… and they’ve successfully lobbied to continue their monopoly on their obtuse arbitration of your income.

In 2005, California introduced Ready Returns, aimed to make the process of filing easier for people with simple taxes. Essentially, the state sent out 50,000 tax forms that were already filled out to citizens. All you had to do was double-check, sign, pay-up. Sounds convenient, doesn’t it?

Except H&R Block and TurboTax threw a lobbying conniption fit, claiming that filing transparency would jeopardize their business. Even worse, they are succeeding: even though citizens love the program, a California senator has introduced a bill to halt the program and it’s very likely to be passed.

As the Wired Article points out, this is like a tire company lobbying to prevent the state from filling in potholes. Their excellent closing summary: “Free markets aren’t pro-business – they don’t favor incumbent companies if upstarts do the job better. Competition is good wherever it comes from – even the government – so long as it lowers social costs and increases wealth. And efficiency is good regardless of who it might hurt; it is especially good if it hurts those who feed off inefficiency. Thus, lawyers are good, but a world that needed fewer of them would be much better. Doctors are great, but that’s no argument against better health. And TurboTax is fantastic, but it shouldn’t prevent the government from making paying taxes easier.”

Not to channel Glenn Reynolds here, but indeed.

Crushing Competition [Wired]