The name of the proposed law is “The Humanity and Pets Partnered Through the Years Act“. Through some spectacular contortions this has acquired the acronym of HAPPY; though HPPTY is more accurate.
Whatever you call it, Pet owners are jumping up and down with glee at the possibility of getting a tax credit, and the Pet industry is encouraging support of the bill. But this is from the same people who gave us “cash for clunkers”; and we saw what a clunker that was. Both remind me of the Alexis de Tocqueville quote: “The American Republic will endure until the day Congress discovers that it can bribe the public with the public’s money“”
This law is so wrong on so many levels. Let me count the ways:
- I cannot see how this law could or should be constitutional at the Federal level. There is no way that pet owners could be considered a privileged or disadvantaged class.
- How can it be that health expenses for kids is not tax-deductible (without use-it-or-lose-it FSA contortions) but Vet bills are?
- This law would require pet owners to retain all receipts for pet food, pet supplies, pet medication, vet bills. For most pet owners that means keeping all of their grocery receipts.
- This law discriminates against those who do not make enough to itemize their taxes.
- When the IRS started requiring the Social Security Numbers of dependents, the number of dependents dropped dramatically. Since Pets do not have SSNs, how would Uncle Sam know how many pets you really have?
- Even if your pet is legit, what is to prevent someone from claiming deductions for pet for years after they have died? Would you have to prove that the pet is still alive every year? What kind of bureaucracy – and how many additional Federal employees – would be necessary to support and police this?
Given that taxes are a zero-sum game (a tax break in one place means new or higher taxes elsewhere), why should those of us who do not have pets subsidize those of us who do?
What problem is this bill really trying to solve?
So what should be done here? Here are some suggestions:
- Make all medical expenses for humans tax-deductible, then you can extended the courtesy to pets. This will help those who incur large Vet bills.
- A one-time tax credit to those who adopt animals would be nice, and would provide an incentive to adopt rather than purchase (but this might backfire… visualize lots of adoptions in December and a huge number of animals out on the street on Jan 2).
Bottom line: Pets are a luxury. If you can afford one, best of luck to you. If you can’t, don’t get one – don’t expect the rest of us to subsidize your pet’s upkeep.