As the deadline for filing yearly income taxes is rapidly approaching, businesses especially hard pressed to make a profit in a depressed economy struggle with their tax compliance. Reporting legitimate deductions and costs is the easy part. When you are losing money, disclosing a diminished income stream based upon lower margins, is not a difficult decision. Nevertheless, small enterprises burdened with government regulation costs and tax obligations, often are unable to conduct business and retain a net return. Self-proprietorships frequently are so scared that many look to the cash underground economy to hide income earnings.
[amazon asin=0688007783&template=*lrc ad (left)]This shadow commerce, practiced throughout the world, is the real economy. Actually, in the United States, tax compliance is quite high by comparison. With the acceptance of instruments of credit, the banking system has become more of a tax reporting service than a financier of a healthy economy. The taxman would have you believe that voluntary transactions in cash constitute a black market in illegal dealing. Casting the aspersion of seedy activities upon the motivation to subsist is a common practice of governmental revenue agents
Building upon this attitude, a deceptive title to a USA report, $2 trillion underground economy aids recovery, would have you think constructive criticism returned to the mainstream press. Sorry to disappoint, you can always count on the Gannett media to be a government mouthpiece.[amazon asin=B005ESMGZU&template=*lrc ad (right)]
Shadow economies are usually associated with illegal activity, such as drug dealing. But anecdotal evidence indicates that off-the-books work in today’s job market includes personal and domestic workers, such as housekeepers and nannies.
People are running out of patience when it comes to finding a job and losing income,” Gonzalez said. “So it’s not that surprising to have workers take jobs that are in the shadow economy. But it’s a sign of how bad things are and how we have to get the real economy moving again.
Yep, blame the poor starving worker for accepting payment under the table by a greedy company owner who wants to beat down labor. What such ridiculous viewpoints lack is that the REAL ECONOMY is based upon main street enterprises for actual job creation. When state requirements become so burdensome that fundamental survival of a business becomes impossible by the tax demands, mere existence as a commercial entity becomes untenable for the entire economic structure.
Little is left of the free enterprise system. When a society imposes tax obligations and government regulations on garage sales upon property that the state has already collected their sales tax, the message is clear. You really own only a partial share of your items in partnership with the government.
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