Monday, April 09, 2012

Tax Bill Is Beginning of Formal Debt Criminalization

The United States Congress is steadily headed to a place where those who owe money to the US government shall be treated criminally.

This phenomenon is advancing domestically and now, increasingly, internationally. The first shot in this latest campaign took place in 2010 when US President Barack Obama signed into law The Foreign Account Tax Compliance Act. It demanded, basically, that foreign banks withhold up to 30 percent of the income that an American abroad might earn.

This bill isn't working so well because overseas banks are not cooperating (a state of affairs that was certainly expected). Thus, there is a need for something else: Senate Bill 1813, recently introduced by Senator Barbara Boxer (D-CA). This bill, in part, states that taxpayers with unpaid taxes over US$50,000 may find their passports confiscated.

This isn't criminal per se, but the IRS has recently made noises about "sharing" information with police authorities. The last time it was an institutionalized crime to owe money within the context of the Anglosphere was during the British industrial revolution when there were such things as debtors prisons. Those were eventually disbanded as it was seen as counterproductive (and even inhuman) to put a man in prison for a debt he could not pay.

But both in the US and in Europe, the concept of imprisoning an individual over debt is making a comeback. In the US it is especially clear. There are plenty of people, mostly men, who are behind bars for falling behind on their child support payments.