What is an acceptable and moral tax?

[noxagol]

Having a discussion in the regular grassroots forums over death tax and it made me think about what would be an acceptable and moral tax. I am having a difficult time with this one so would like some input.

What would be an acceptable and moral tax? And if one does not exist, then is government acceptable and moral?

[johnscr]

Having a discussion in the regular grassroots forums over death tax and it made me think about what would be an acceptable and moral tax. I am having a difficult time with this one so would like some input.

What would be an acceptable and moral tax? And if one does not exist, then is government acceptable and moral?

Simple enough. A voluntary tax (ie a donation) would be acceptable or a user fee for a non-coercive transaction. Anything else is money taken by force.

[noxagol]

Well, I don't think a government ran on donations would be able to perform its duties of defending its people from attack and defending the individuals rights. What sort of non-coercive transaction are you thinking of?

[nexalacer]

Well, I don't think a government ran on donations would be able to perform its duties of defending its people from attack and defending the individuals rights. What sort of non-coercive transaction are you thinking of?

Has any government in history actually done this for any significant period of time?

And yes, donation based taxes are the only way to have moral taxes. But then if they are donations, then the government is no longer a government, but a business. A business is in the best interests of everyone, because if the business starts to do shady things, the people can vote with their dollar, which is leaps and bounds more effective than the bullshit voting process.

[fsk]

All forms of taxation are theft.

Following that conclusion, there are NO morally acceptable taxes.

Do you have the right to steal from me? I assume you answer no.

If you don't have the right to steal from me, then how can you, by voting, authorize other people to steal from me on your behalf.

[johnscr]

Well you asked what moral tax would be. Perhaps government is not possible on a completely moral basis. One point of view is that the compromise is worthwhile

It seems to me people would volunteer contribute to things they think are important just as they do now.

On the other hand there have been proposals that show how courts and self-defense can be done on a non-coercive basis. See for example http://www.daviddfriedman.com/

[anotherone]

I think local sales taxes are fine (I think we need police, courts, fire dept).

Federal government 100 years ago, got by on excise taxes (I think on tobacco & alcohol), and tariffs. There were probably several other sources of federal income at the time.

[chipvogel]

I work for a living. I change hours of my life into dollars. If I don't have control over those dollars I don't have control over my life and I am not free. Taxes don't have to hit 100% to become a form of slavery.

Tax freedom day is now April 30th or 32.69% of the year. This is the amount of time we spend working every year to pay taxes. The argument is we're only partially enslaved by our government. They've moved freedom into a continuum and freedom is now measured relative to how free people are in other countries.

We have the most freedom of all the people on earth...but thats not the same thing as being free people, it just means we aren't enslaved as much as in other countries.

I don't see freedom this way; being a 1/3 enslaved is like being a 1/3 dead. Freedom is a very black and white issue and should be spoken of in absolutes.

[cindy25]

head tax, where everyone pays exactly the same is moral.

customs duty, user fees, excise taxes are acceptable but not not strictly moral

[TurtleBurger]

I work for a living. I change hours of my life into dollars. If I don't have control over those dollars I don't have control over my life and I am not free. Taxes don't have to hit 100% to become a form of slavery.

Tax freedom day is now April 30th or 32.69% of the year. This is the amount of time we spend working every year to pay taxes. The argument is we're only partially enslaved by our government. They've moved freedom into a continuum and freedom is now measured relative to how free people are in other countries.

We have the most freedom of all the people on earth...but thats not the same thing as being free people, it just means we aren't enslaved as much as in other countries.

I don't see freedom this way; being a 1/3 enslaved is like being a 1/3 dead. Freedom is a very black and white issue and should be spoken of in absolutes.

I love this argument! You should publish it!

[inibo]

What would be an acceptable and moral tax? And if one does not exist, then is government acceptable and moral?

$0 or 0% whichever is lower. :D

If the state offers a service in a free market and I find it of sufficient quality at a price I'm willing to pay I will happily pay for my use of it. Neither the state nor anyone else is justified in sending armed men to force me to pay for something I don't want.

I've been reading LewRockwell.com (http://lewrockwell.com) for too long. It's starting to rub off on me. :D

[nexalacer]

Well you asked what moral tax would be. Perhaps government is not possible on a completely moral basis. One point of view is that the compromise is worthwhile

It seems to me people would volunteer contribute to things they think are important just as they do now.

On the other hand there have been proposals that show how courts and self-defense can be done on a non-coercive basis. See for example http://www.daviddfriedman.com/

Morality is not a compromise. Either you are moral or you are not. I am pretty sure most people would like to be moral and have integrity, so I don't think people actually look at it like a compromise. They typically believe that it IS moral to have a government and that is the problem.

The entire existence of the government is based on immorality. The sooner we accept that, the sooner we will be free.


head tax, where everyone pays exactly the same is moral.

customs duty, user fees, excise taxes are acceptable but not not strictly moral

By this, I infer that you mean that as long as everyone is doing the same thing, it is moral. Is this a correct assessment?

If so, then what was wrong with slavery? Everyone was doing it, so it must have been moral, right?

Or maybe theft can be moral if done by people other than the government? I mean, what's the difference between me and the tax collector, besides the badge that he carries? If he can come and take money from me through the threat of imprisonment, nay, death, then can I go to your house with a gun and demand 1/3 of your income, as long as I do it to everyone else?

[nexus7]

I think local sales taxes are fine (I think we need police, courts, fire dept).

Federal government 100 years ago, got by on excise taxes (I think on tobacco & alcohol), and tariffs. There were probably several other sources of federal income at the time.

We don't need the current organized crime/police system we currently have. There either needs to be a complete overhall or we should have a peoples police force. We are slaves to the police system of ticket giving and intimidation. This all needs to change. We don't need fire. Volunteer fire works just fine. Courts are another issue. The justice system has flaws and could use an overhaul because the district courts aren't following the constitution. example, 9th circuit.

[Goldwater Conservative]

At the federal level, probably just a proportional tax on the states. Let them figure out how to raise the revenue.

For general revenue at the state level, I favor a one-rate, broad-based consumption tax... like the FairTax without the prebate. In fact, I'd like it written into my state's constitution that way to prevent special interests from carving out exemptions for themselves. I also think there should be constitutional caps on tax rates, among other limitations. User fees are the best way to go whenever possible, however.

I know I'm probably out of the mainstream on this around here, so go easy on me. :)

[ProBlue33]

I hate taxs just as much as anybody else.

But if everybody paid 0 tax, they kept every cent they made nothing went to the feds or the state, or civic authorities. Who pays for roads, police, firemen.
Where does that money come from. If there are no taxs no corporations pay either. It just would not work.

I think income tax on money earned should be eleminated and they sales tax should go to. Maybe a tax on savings, I say that because people who save money aren't really re-investing back into the economy, and many of us have no savings anyway sadly enough.

Those with the least money get no taxs at all, that way it's easier for them.
But you can make a lot of money but if you spend it on cars and houses and goods you help the economy, also during the most expensive years raising children costs are very high. I believe in a bible saying of "let there be an equalizing" so the millionares would maybe get like 5% flat tax, they can afford it.

If you had $100,000 in the bank like 3% again they can afford it. If you have less than $30,000 savings no tax.

Property taxs on large parcels of land, that isn't farmland

Remember the money MUST come from somebody, even if you did cut every program just like Ron Paul is talking about, you still need basic services.

[inibo]

Who pays for roads, police, firemen.
Where does that money come from.

The money comes for the people who use those services. Why do you think only the state can provide them?

[Goldwater Conservative]

Maybe a tax on savings, I say that because people who save money aren't really re-investing back into the economy, and many of us have no savings anyway sadly enough.

Bad idea. Most economists, even liberal ones, agree that consumption taxes are the way to go because they remain neutral with respect to savings. It's penalizing that which hinders economic growth, since it reduces investment (unless you're using your mattress :)). Free markets need capital.

Savings should only be taxed after you convert them into consumption. It'll have contributed to the greater good in the meantime.

[user]

noxagol I think I was discussing this with you in that death tax thread.

I've thought about this for a long time, and I've seen a lot of different answers to this.

Obviously a lot of people believe no tax is acceptable. Some of the people in that group believe government should still exist and should be run on donations. That doesn't make sense to me because there's no way to ensure the government has enough money to operate. (By the way, this is one of the main reasons Alan Greenspan separated ideologically from Ayn Rand.)

One tax that may make more sense than others is a property tax, since the government's main role (we hope) is to defend private property. So it would be kind of like a user fee for the government's protective services. I don't particularly like property taxes any more than other taxes, though. You could also have user fees (probably loser pays) for lawsuits, since the government is supposed to enforce contracts.

I think property taxes do make much more sense than the income tax from a philosophical standpoint, but it is still the lesser of two evils.

There are a lot of other ideas like LVT that may each have their own problems...


Most economists, even liberal ones, agree that consumption taxes are the way to go because they remain neutral with respect to savings.

Too bad they don't all understand inflation as well as Ron Paul does!

[Goldwater Conservative]

One tax that may make more sense than others is a property tax, since the government's main role (we hope) is to defend private property. So it would be kind of like a user fee for the government's protective services.

My problem with them is that property values can be erratic. I live in Miami, for example, which has been on a real estate roller-coaster ride for a few years, even as wages have barely risen. Hell, even general inflation has at least been consistent in which direction it goes. Plus, it's up to the government to assess what your property is "worth"...

Another reason I prefer consumption taxes is that they can be justified as the government enabling every transaction to take place with relatively low transaction costs.

[user]

My problem with them is that property values can be erratic. I live in Miami, for example, which has been on a real estate roller-coaster ride for a few years, even as wages have barely risen. Hell, even general inflation has at least been consistent in which direction it goes. Plus, it's up to the government to assess what your property is "worth"...

Another reason I prefer consumption taxes is that they can be justified as the government enabling every transaction to take place with relatively low transaction costs.

I agree that property values can be erratic, but most of this is because of Fed-created bubbles. Yes, the government getting to assess your property is a problem, but the percentage chosen for any consumption tax is also going to be arbitrary.

I don't understand how the government enables every transaction to take place - if I sell something to my neighbor, does he have to pay a tax? If not, then the sales tax is not consistent. If so, why?

[CCTelander]

There are no moral taxes. ALL taxation is theft.

[Goldwater Conservative]

I agree that property values can be erratic, but most of this is because of Fed-created bubbles. Yes, the government getting to assess your property is a problem, but the percentage chosen for any consumption tax is also going to be arbitrary.

Good point about the Fed. But to me the big difference between assessing property values and setting a rate is that the latter applies universally while the former involves a far more complicated metric open to a great deal of subjectivity. Maybe if consumption taxes had multiple rates based on the product/service, but that's not usually the case and I don't see that changing.


I don't understand how the government enables every transaction to take place - if I sell something to my neighbor, does he have to pay a tax? If not, then the sales tax is not consistent. If so, why?

Well, if you already bought it in a store, the tax has already been paid. Consumption taxes (that I know of) don't apply to used goods. But I see your point and maybe should rephrase my wording for better clarity: government enables businesses to operate as efficiently as they can, since there is a constant authority to appeal to in case of disputes, so a tax proportional to their transactions is appropriate. That just happens to work out to a tax of a certain percentage on each item or service.

[user]

Good point about the Fed. But to me the big difference between assessing property values and setting a rate is that the latter applies universally while the former involves a far more complicated metric open to a great deal of subjectivity. Maybe if consumption taxes had multiple rates based on the product/service, but that's not usually the case and I don't see that changing.

I think you're right that a consumption tax rate is more transparent and consistent than whatever method the government would use to assess property values.


Well, if you already bought it in a store, the tax has already been paid. Consumption taxes (that I know of) don't apply to used goods. But I see your point and maybe should rephrase my wording for better clarity: government enables businesses to operate as efficiently as they can, since there is a constant authority to appeal to in case of disputes, so a tax proportional to their transactions is appropriate. That just happens to work out to a tax of a certain percentage on each item or service.

I meant for new goods. Suppose I made something using only resources from my own property and sold it to my neighbor. I don't think such a simple transaction should be subject to sales tax, but the distinction between such transactions and "regular" stores is arbitrary. So either that transaction would have to be taxed, or a sales tax wouldn't be consistent.

In general, I'm opposed to taxes on exchange because it really shouldn't be any of the government's business. It makes some sense for the government to know who owns what land, in order to protect it on behalf of that person, but why should they know about every transaction made between free individuals? They have to know about them, or at least claim that authority, to regulate and tax them. The less they know, the less they can regulate. The less they can regulate, the better.

[Goldwater Conservative]

I meant for new goods. Suppose I made something using only resources from my own property and sold it to my neighbor. I don't think such a simple transaction should be subject to sales tax, but the distinction between such transactions and "regular" stores is arbitrary. So either that transaction would have to be taxed, or a sales tax wouldn't be consistent.

True. In practice, though, most transactions aren't done that way (although I'm sure the Internet is changing all that), so it's not really much of a problem, but I see your point from a philosophical perspective.


but why should they know about every transaction made between free individuals?

If they only levy the tax on businesses, I think they just need to know the net transactions, at least if they did it more like a value-added tax (forgetting the bad reputation Europeans have given it) instead of a retail sales tax. But hey, I've always attacked the income tax from a civil liberties perspective similar to the one you raise, so I won't press the point.

Maybe if Paul was president and was able to do something about the Fed (among some of the government's other market interventions) and the real estate market stabilized, I would find a land-based tax more appealing, since I do concede it has some of the better justifications.

[user]

I have heard worse stories about property taxes than sales taxes, such as retirees on fixed incomes struggling to pay. I think fixing inflation solves this problem, because then people will have real savings that aren't eaten away constantly and less of an incentive to spend. Not to mention the lack of Fed-induced skyrocketing property values that take tax bills up with them. Also reverse mortages seem to be getting popular. I guess they could be a last resort.

I do hope RP is able to do something about the Fed. The inflation they cause has such far-reaching effects that it may be a bigger issue than the Iraq war in the long term. In fact, without inflation it would be much more difficult, maybe even practically impossible, to start and maintain needless wars.

[constituent]

acceptable AND moral:

i call that a voluntary contribution

[JosephTheLibertarian]

Having a discussion in the regular grassroots forums over death tax and it made me think about what would be an acceptable and moral tax. I am having a difficult time with this one so would like some input.

What would be an acceptable and moral tax? And if one does not exist, then is government acceptable and moral?

voluntary contributions. no tax :) like your police? your fire departments? then send money!

[noxagol]

I don't like property tax that focuses on the value of the property. I think that if it was a fixed number per area of land owned it would be better. You could find out how much land is owned by the people, split this up equally per unit of land, and then tax the owners based on how much area of land they own. Amount of land x tax per unit of area=total tax. People would be taxed proportionally to their wealth so poor people would not be unfairly punished by the tax, it would be a voluntary amount, if you want to pay no tax rent land from someone else (the tax would be passed on I know), it sets a fixed dollar amount the government will be able to raise so it would create stability in the budget making it easier to make budgets since their is less guess work to be done through projections and everyone would know how much the government is making. It wouldn't be that high of a tax either if the government was kept to only police/military depending on level in question, and since the police work to protect your property, it is in exchange of a service. It is also proportional to the service for the police because the more land you own, the harder it is for the police to protect your property so they should be able to collect more. It also sets a fixed cost on the service in total for property protection.

I think that court cases should be funded not by taxes but by those who use the service, and I think that the loser should pay the fee. The fee should be put up initially by both parties, but once the loser of the trial is determined, they must recompensate the loser for their share. This creates incentive to only go to trial when it really matters and to have proper evidence and a proper and good case built before you take someone to trial. This will reduce the number of court cases and more importantly will reduce the number of frivilous cases because a business would be more likely to fight stupid lawsuits like the McDonald's Coffee case since they would get their court fees and attorney fees recouped when/if they won. It would also create disincentive to use the courts as a form of lottery because people who didn't really have a case would be less likely to bring it to trial for fear of losing and having to pay the other guys lawyer fees. It should be a flat rate based on time spent in the court + materials needed to conduct the trial, with some money placed upfront and if their is excess it being refunded equally to the payers.

[CCTelander]

I used to have a buddy on another forum who, when asked "Well how do we fund the 'necessary' functions of government without taxes?" would reply:

"Oh, I don't know. Bake sales, swap meets, maybe garage sales. Take your pick."

I always got a kick out of that! :D

[noxagol]

I used to have a buddy on another forum who, when asked "Well how do we fund the 'necessary' functions of government without taxes?" would reply:

"Oh, I don't know. Bake sales, swap meets, maybe garage sales. Take your pick."

I always got a kick out of that! :D

Heh.

[smtwngrl]

One example of a completely acceptable and moral tax is the gasoline tax--at least, as long as the revenue is used for the roads, and not siphoned into other areas.

Those who use the roads are those who pay it. And, in general, the types of vehicles that use more gas are also those that wear on the roads more. It's also a tax that is non-intrusive on privacy (in comparison, say, to the IRS).

(As for the larger question of what tax/taxes should be used to provide essential services, though, I don't have a ready answer about which would be best--without a lot of consideration.)

[PaleoForPaul]

What would be an acceptable and moral tax? And if one does not exist, then is government acceptable and moral?

The federal income tax should be 0%. We should have tariffs on goods from other countries to support the running of the federal government. That is how it was done before the income tax was huge. This does not inhibit growth as many like to say. China is using a tariff now, and cleaning our clocks when it comes to economic growth.


In times of war there should be a war tax, that can be handled at the federal level, but it only goes through if congress actually votes to go to war.

State taxes should be up to the state. Most services should be given at the state or local level.

A flat consumption based tax on non-essential items on the state level would be the way to go.

[nexalacer]

The idea of property tax is pretty disgusting to me.

By taxing the land that is your home, they are really driving home the point that you are, in fact, a slave whose been allowed some freedoms. You can't live on the land where you built your home without giving a portion of your income to the government? Disgusting.

I suppose some might say, well we need the property taxes to pay for the schools! I'm not a big fan of the 12 year indoctrination camp anyhow, so let's get rid of them, too!

[user]

The idea of property tax is pretty disgusting to me.

By taxing the land that is your home, they are really driving home the point that you are, in fact, a slave whose been allowed some freedoms. You can't live on the land where you built your home without giving a portion of your income to the government? Disgusting.

I suppose some might say, well we need the property taxes to pay for the schools! I'm not a big fan of the 12 year indoctrination camp anyhow, so let's get rid of them, too!
I'm all for getting rid of government schools.

Sales taxes are similarly disgusting though. Unless you are totally self-sufficient, which almost no one is because the disadvantages are so severe, you can't avoid paying the tax, unless there are arbitrary exemptions. If we can't make peaceful exchanges without government interference, how free are we really?

[axiomata]

The money comes for the people who use those services. Why do you think only the state can provide them?

"Hello, this is 911 emergency services, how may I help you?"
"HELP! Someone has broken into my house!"
"OK, stay on the line, and find a safe place to hide. Would you like me to dispatch the police?"
"Please do."
"OK, that will be $2999, will you pay be credit?"
"Uh, I don't have $2999, please help me!"
"I'm sorry, we can't send the police until we process you payment."
"OK OK, I'll charge it."
"OK then, do you know whether the intruder is armed?"
"I don't know, I think so."
"OK, that will be an additional $1500."
"Whatever!"
"Pleasure doing business with you, have a nice day!"

[nexalacer]

I'm all for getting rid of government schools.

Sales taxes are similarly disgusting though. Unless you are totally self-sufficient, which almost no one is because the disadvantages are so severe, you can't avoid paying the tax, unless there are arbitrary exemptions. If we can't make peaceful exchanges without government interference, how free are we really?

Well, yeah, I agree completely... tax is theft however it's proposed... that's why I'm for market anarchy!! :D

[Thurston Howell III]

One NOT imposed on income!

[nexalacer]

"Hello, this is 911 emergency services, how may I help you?"
"HELP! Someone has broken into my house!"
"OK, stay on the line, and find a safe place to hide. Would you like me to dispatch the police?"
"Please do."
"OK, that will be $2999, will you pay be credit?"
"Uh, I don't have $2999, please help me!"
"I'm sorry, we can't send the police until we process you payment."
"OK OK, I'll charge it."
"OK then, do you know whether the intruder is armed?"
"I don't know, I think so."
"OK, that will be an additional $1500."
"Whatever!"
"Pleasure doing business with you, have a nice day!"

Really? You think this is a plausible scenario? How long do you think a business that operated in this manner would survive? I would suggest it wouldn't last past the first incident where someone died or got hurt from having no protection.

Yet the police don't provide ANY protection, and they are still supported by our stolen wealth. Police will not immediately respond to a robbery call because they'd rather not face an armed suspect because they, like you and me, don't want to put themselves in unnecessary situations of risk. And since people often have insurance so whatever is stolen will be returned, it is unnecessary to risk their lives to protect someones big-screen HD TV.

I'm going to stop because I don't think it'd do any good continuing this argument with someone who actually posted this as a plausible scenario. If I'm wrong, please use logic, rationality, and empiricism to prove how this situation could actually occur more than once. Thanks!

[FreeTraveler]

There are no moral taxes. ALL taxation is theft.

+1

Different people will have different views of an acceptable tax, however. I happen to be one who feels there are no acceptable taxes, either. The most I'll go for is user fees for specific public issues, like toll roads. I might even stretch that to per-gallon gasoline fees for roads maintained by a district, charged within the district. A state verges on being too large to consider a "district" and FedGov certainly doesn't qualify.