I started on a research project to determine whether taxes are called that because they are taxing or whether taxing became a descriptor because a thing is "bothersome, like a tax." A chicken/egg investigation.
The answer seemed to be that I couldn't figure out an answer easily, because apparently "tax" doesn't mean what we think it does, so I stopped thinking about that for now.
However, here is something I learned about income tax recently.
In the U.S., income tax is based on citizenship. Are you a citizen? You pay U.S. income taxes, or else you tell the IRS why you think you don't have to. And that's a real "or else." The IRS doesn't care where you live: you're a citizen, you owe me. Fork it over.
In Canada, income tax is based on residence. Have you lived in Canada long enough to warrant paying income tax? If so, great. Fork it over. We don't care what country you're a citizen of. Pay up. But if you're a Canadian citizen living elsewhere, pay where you live and let us know when you're back.
The residence-based system is sometimes known as "the British system," which must be why the U.S. doesn't use it. (We don't need no stinkin' British anything.) However, the U.S. is not alone: about half of the world uses one system and the other half uses the other.
In any case, if I were a Canadian living in the U.S., I'd pay tax only in the U.S. As a U.S. citizen living in Canada, I'll pay taxes in two countries forever.
Except that actually, I don't have to PAY taxes in both countries. I just have to file paperwork showing the U.S. that I'm paying in Canada. (Or vice versa, but that's how I'm doing it.) Which is where the IRS and I are having a difference of opinion. I've sent an amended form for 2007's taxes, because the IRS sent me a nasty-gram in the fall and rather than investigate then, I just paid it. But now, I can show that I didn't owe it. Or so I believe.
The British system seems friendlier. It also seems to require less paperwork. Nobody has to file a form saying you don't have to pay. You just don't pay. What does the IRS do with all those "I don't have to pay" forms once they're filed? It just seems wasteful. However, I'm sure the IRS thinks I don't see the whole picture.
One thing is certain: writing about taxes is infinitely preferable to collecting information for taxes and figuring out what one owes. I just hope the same goes for you, the reader--but then, you can click away at any time.
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A U.S. writer living in Canada examines borders, boundaries, and other invisible (though not imaginary) lines.
