I try not to blog too much about about NZ-this or USA-that. It's just not productive to be measuring one country against the other, ya know? Be where you're at. But I filed my NZ taxes today and because taxes have been such an annual ordeal in my life, this year was a revelation.

My first introduction was talking to an employee at the bank/post office about how I probably needed to sort this out (the tax year ended March 31) and I asked him what he did each year. He gave me a funny look. I don't have to file anything, he said. It's already calculated and there's no reason to file anything.

Not file taxes?!? Not sweat over the freaking schedule ABCDE, SE, and myriad other forms that made my 1040 into a small book?




I hit the IRD New Zealand website and there it is, that beautiful statement: "Most people who earn salary or wages pay the correct amount of tax and don't need to do anything at the end of the tax year."


Can you imagine such a thing? I used to start preparing my US taxes in early March, because I knew it would take several weekend sessions to get the thing done. The idea that you might not even need to send in a form struck me initially as fantasy-land stuff.


But you know when you look over the personal tax form, called the IR3, it is so simple - 3 tax brackets, few deductions and special cases, that it begins to make sense. Here it is, if you want to have a look.

http://www.ird.govt.nz/resources/c/2/c26b87004dbf7347bf6abf90ad5f3a80/ir3-2009.pdf

I guess what happened to me during this process, is I moved beyond the sorts of statements often made under and about US taxes, e.g. "The tax system is broken," to actually seeing what it could be like, and how it could function. So much of that stuff - from capital gains and losses to the byzantine way self-employment taxes are calculated, simply doesn't have to be done that way, or done at all.






Nonetheless, as I decided whether I needed to file at all, I had a question... about interest on a bank account. So I called the 800 number for the IRD and I was placed into a hold queue. Usually this would be cause for despair, but here's the way the system works, I got a message telling me how long the wait would be (within a 10 min window) and would I like a callback? Yes, I would, I decided. I entered my phone number, and after that amount of time, I received the help call.


The person walked me through what I needed to do and - are you ready for another shocker? - took down my interest information and entered it into the system right at that time. As it turned out, I had over-withheld taxes via the bank, and I would in fact be due a refund. They also took my bank details and it will be transferred to my account within a few days. All that on the first phone call! I have now effectively filed my taxes, along with submitting one revision handled by phone.

Now I understand the tax system has been called largely voluntary, meaning much of the information will never be checked by anyone, and it is in some doubt exactly what numbers the goverment possesses anyhow, but to take the interest paid and amounts withheld off me in a phone call, imagine that! It begins to feel like I am actually trusted to report the right thing, and that feels pretty good. And I hadn't thought about it till now, but I reckon that means that the IRD places some trust and responsibility with the person on the other end of that phone call, too.

I will close by saying that when thinking about systems, such as tax in NZ, I can find myself making arguments for the USA (or NZ) because of relative size. Oh no that only works in NZ because it's so small. That kind of thing. But I'm not going to accept that. In fact, a huge country with a huge base of taxpayers could arguably have many more resources and wherewithal to craft solutions for a problem. Isn't it the same sort of reasoning - the whole economies of scale thing - that makes us imagine Home Depot is more "efficient" than a small corner hardware store? And just so, couldn't the US run the exact same call handling software that enables polite, scheduled callbacks at an agreed upon number and future time? Couldn't we find a way to get the job done without TurboTax, a personal tax accountant, or a month of weekends stolen away to get intimate with the tax code?

Me and Andrew were messing around and taking pictures of ourselves jumping. Here are the best ones.




My biggest jump.

Andrew while jumping.