Dan Popp
February 20, 2013
A just tax
By Dan Popp

I appreciate the backers of the Flat Tax and the Fair Tax. Either of those proposals would be better than the current viper's nest we call a tax "system." But in my view both leave dangerous powers in the hands of the federal government, and both fall short of the standard of justice.

Now, justice is the function of government. That is its reason for being. Whenever government imposes injustice it renders itself unnecessary, because we can have plenty of injustice directly, without the hassle and expense of a middleman. So in every way, including the ways it is funded, government must operate justly.

What principles would frame a just tax?

A just tax would be limited.

Conservatives aren't thinking clearly when they propose capping federal income taxes at a certain percentage of GDP. While anything called a limit might seem a step in the right direction, this plan concedes that government has a right to "this much" of our productivity, which is untrue and unsafe.

Consumption taxes have the advantage of being self-limiting, said Alexander Hamilton:
    If duties are too high, they lessen the consumption; the collection is eluded; and the product to the treasury is not so great as when they are confined within proper and moderate bounds. This forms a complete barrier against any material oppression of the citizens by taxes of this class, and is itself a natural limitation of the power of imposing them. – Federalist 21
A just tax would protect all forms of private property, including income.

As John Locke wrote, humans submit to government because of our desire to protect our property; it makes no sense for us to grant it the authority to seize our property! The Flat Tax, being an income tax, is an unjust tax.

A just tax would not tax anything that can't vote.

In other words, "No Taxation Without Representation." Robbing the profits of businesses may be emotionally satisfying to the stunted left, but it serves no good purpose and plenty of bad purposes. Forbidding government to tax businesses would have the side benefit of taking away its threat to tax churches if they don't toe the line. When government can tax businesses but not churches, it is automatically in the business of deciding what is a church. That power is a constant threat to religious liberty.

A just tax could not be levied by those who don't pay taxes.

I call this principle, "No Representation Without Taxation." If we really believe that "we're all in this together" (as our President likes to say) then we must devise a system whereby, if you want to lower taxes on the poor, you have to cut the taxes of everyone. If you want to raise taxes on the "rich," you vote to raise your own taxes as well.

This gets to my quarrel with the Fair Tax; it allows the same robbery-via-ballot-box that we have now. We must re-establish the link between the right to vote and the responsibility to pay taxes. The fact that the poor must pay taxes is unfortunate; the fact that some citizens can appropriate the earnings of others from the voting booth is unjust. At some point we must abandon the folly that we can remedy misfortune with injustice. Government was not put on this earth to heal bad luck.

A just tax would be fully visible.

No more taxing corporations to hide the fact that the consumer pays all taxes. No more fees in the fine print of your telephone bill to pay for the Spanish American War. Our current tax code is not only unfair but sneaky. Underhanded. Cowardly. It's an admission by its devisers that people wouldn't put up with these levels of taxation if they knew what they were paying.

A just tax would tax each dollar only once.

If the green-eyed government is salivating for 90% of my income, it should be forced to take it all in one bite. Efficiency demands as much, not to mention honesty and transparency. Once we commit to taxing each dollar only once, I think we're led logically to either an income tax or a sales tax – the points at which a dollar enters or leaves your possession. Since an income tax is legalized theft, that leaves us with the solution the Founders gave us to start – consumption taxes.

A just tax would treat all taxpayers equally.

The hated tax collectors of Jesus' day didn't sin by charging for their services. They sinned because their surcharges weren't the same rate for everyone. In effect, there was a different tax rate for each taxpayer, invented on the spot on the whim of the collector. They were the original progressive taxers. Clearly, a different law for each person is unjust. How is a different law for each group of people any different? In a just tax there would be no arbitrary thresholds dividing the more-oppressed from the less-oppressed from the government-blessed.

A just tax could not be used to manipulate behavior.

The purpose of taxes is to fund the legitimate duties of government – not to subsidize some people, companies and industries while hampering others. A national sales tax – imposed only after the repeal of the income tax – and imposed uniformly on all retail sales of everything to everyone, with no exceptions, seems to be the closest we could get to a just tax. Again, it's unfortunate that we have to tax pacemakers and bread the same as we tax pedicures and tobacco. But if we allow our employees in Washington to choose what is taxed and what isn't, the door is open for the same market deranging, vote buying and social engineering that we have now.

Where is the conservative leader who will crusade to repeal the 16th Amendment, do the hard work necessary to educate a dull and dependent populace, and champion a just tax?

© Dan Popp

 

The views expressed by RenewAmerica columnists are their own and do not necessarily reflect the position of RenewAmerica or its affiliates.
(See RenewAmerica's publishing standards.)