{"id":2731,"date":"2008-03-06T07:05:23","date_gmt":"2008-03-06T12:05:23","guid":{"rendered":"https:\/\/www.orthodoxytoday.org\/blog\/2008\/03\/06\/what%e2%80%99s-just-about-taxes\/"},"modified":"2008-03-07T14:08:17","modified_gmt":"2008-03-07T19:08:17","slug":"what%e2%80%99s-just-about-taxes","status":"publish","type":"post","link":"https:\/\/www.orthodoxytoday.org\/blog\/2008\/03\/what%e2%80%99s-just-about-taxes\/","title":{"rendered":"What\u2019s “Just” about Taxes?"},"content":{"rendered":"

Acton.org<\/a> | Samuel Gregg | Mar. 5, 2008<\/p>\n

Everywhere, it seems, tax is in the news. At least two U.S. presidential candidates have signaled their intention to raise taxes on higher-income earners and specifically target oil companies if they are elected.<\/p>\n

In Venezuela, Hugo Chavez is threatening to heavily tax any food company making \u201cexcessive profits\u201d \u2014 whatever that means \u2014 as his \u201c21st century socialist\u201d economy falters in its ability to perform even basic tasks such as feeding Venezuelans. <\/p>\n

Across the Atlantic, Germany is proposing \u201cspecial\u201d taxes on bank-transfers to Switzerland, Liechtenstein, and Monaco. Britain\u2019s government recently suggested increasing taxes on non-domiciled foreigners, and only retreated after a public outcry. Even the Organization for Economic Cooperation and Development (OECD) has weighed in, recently telling Monaco, Liechtenstein, and Andorra that their low tax rates are anti-competitive. Oddly enough, by \u201canti-competitive,\u201d the OECD means that these countries\u2019 tax-rates are lower than everyone else\u2019s.<\/p>\n

Another bizarre development is that some American clergy and politicians now quote the Bible to justify raising taxes \u2014 as if the Bible expressively mandates high tax-rates.<\/p>\n

Of course, there\u2019s nothing intrinsically immoral or unjust about low tax rates for individuals and companies. It\u2019s telling, however, that numerous interest groups, NGOs, and politicians treat any proposal to lower taxes as if it was the equivalent of homicide. Perhaps even more disturbing is the fact that most people in developed countries \u2014 especially Western Europeans \u2014 have simply become habituated to governments taking over 40 percent of their annual incomes.<\/p>\n

In 1913, the highest American federal individual income-tax rate was 7 percent on $500,000. Today, the equivalent tax-rate is 35 percent on $357,700. It is not only the rate increase that is remarkable. One dollar in 1913 had considerably more buying power than a 2008 dollar. In other words, most Americans today pay more tax on money which itself is worth much less than it was 95 years ago.<\/p>\n

In his Wealth of Nations, Adam Smith said that taxes were necessary to enable governments to perform three essential functions. One was national defense. Another was public security and the administration of justice. The third was public infrastructure needs, though Smith envisaged that governments could contract much of this to private companies.<\/p>\n

Today\u2019s reality, however, is that taxes are raised for purposes that go far beyond these limits. Many politicians, for example, do not even bother to disguise the fact that they regard high taxes as a means for massive wealth-redistribution and financing social engineering. The fact that high taxes destroy incentives for entrepreneurs and businesses to create the wealth that gradually improves everyone\u2019s material well-being \u2014 including the poor \u2014 appears to escape many politicians\u2019 attention. Likewise high tax rates are often justified by the need to fund government-provided social services that families, charities, private associations, and churches are invariably much better at performing.<\/p>\n

Then there are the negative moral effects of high tax rates.<\/p>\n

First, high taxes undermine respect for property rights. If the state routinely takes, say, 40 percent of peoples\u2019 incomes, then we should hardly be surprised that some individuals become rather casual in the way they treat others\u2019 private property. Second, the existence of high taxes helps facilitate a culture in which some political parties basically tell people that, in return for their vote, they will effectively transfer large amounts of others\u2019 property to them via taxation. That\u2019s surely a mild form of corruption.<\/p>\n

. . . more<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Acton.org | Samuel Gregg | Mar. 5, 2008 Everywhere, it seems, tax is in the news. At least two U.S. presidential candidates have signaled their intention to raise taxes on higher-income earners and specifically target oil companies if they are elected. In Venezuela, Hugo Chavez is threatening to heavily tax any food company making \u201cexcessive … Read more<\/a><\/p>\n","protected":false},"author":497,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"generate_page_header":"","footnotes":""},"categories":[72,83],"tags":[],"class_list":["post-2731","post","type-post","status-publish","format-standard","hentry","category-leftism","category-taxation"],"_links":{"self":[{"href":"https:\/\/www.orthodoxytoday.org\/blog\/wp-json\/wp\/v2\/posts\/2731","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.orthodoxytoday.org\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.orthodoxytoday.org\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.orthodoxytoday.org\/blog\/wp-json\/wp\/v2\/users\/497"}],"replies":[{"embeddable":true,"href":"https:\/\/www.orthodoxytoday.org\/blog\/wp-json\/wp\/v2\/comments?post=2731"}],"version-history":[{"count":0,"href":"https:\/\/www.orthodoxytoday.org\/blog\/wp-json\/wp\/v2\/posts\/2731\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.orthodoxytoday.org\/blog\/wp-json\/wp\/v2\/media?parent=2731"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.orthodoxytoday.org\/blog\/wp-json\/wp\/v2\/categories?post=2731"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.orthodoxytoday.org\/blog\/wp-json\/wp\/v2\/tags?post=2731"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}