House Ways and Means Chairman Charles Rangel of New York admitted last week that in recent years he has underpaid his taxes by about $10,000. Republicans are demanding that he step down as chairman pending an Ethics Committee investigation, but we're more sympathetic. Charlie is a victim of the tax code he helped to write.
His lawyer says Mr. Rangel flubbed his tax return by failing to record some $75,000 of rental income he received from a beach house he owns at a posh Dominican Republic resort. Mr. Rangel professes to have made an honest mistake, and says "I personally feel that I have done nothing morally wrong." He explained that he didn't know how much income he received from the property because his Dominican business partners would "start speaking Spanish."
Plenty of Americans know how he feels since the IRS tax form might as well be in Spanish. The tax code now runs to some 67,000 pages, and Mr. Rangel has probably written a few thousand himself in his 38 years on Capitol Hill. If even the nation's top tax writer can't figure out what to declare as income, and what not to declare, how can the rest of us be expected to get it right?
Not that the IRS will show Joe Taxpayer any mercy. In most disputes over even honest mistakes, the tax collectors presume guilt. Mr. Rangel is also one of those who like to denounce corporations that shield income overseas. He'd better hope both the IRS and his House colleagues treat him with more forbearance than he and they treat private citizens or businesses. Who knows, maybe Mr. Rangel will even take this embarrassment as new motivation to work with the next President on tax reform. How do you say "flat tax" in Spanish?
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