Income Taxation Is Not Theft

Introduction: Let me begin by thanking my esteemed opponent for his participation in this debate. I am looking forward to a stimulating and provocative exchange. It seems that underneath the postulation that income taxation is theft lies an intuitive, nonexplicit presupposition that we earn our money without any help of the government. And that the government, consequently bears the burden of justification. It is this hidden lethal assumption I want to challenge. Argumentation: I admit that the intuitive advantage probably lies with my opponent. Taxes, especially income taxes, may be viewed as prima facie unjust. Indeed when we earn money from our work, a contribution or some other kind of effort, we subsequently, almost automatically assume that we deserve and are entitled to that money. This is a widely and often implicitly held view. If then a portion of ‘our’ money is taken away by the government, this might feel unfair, or even like a crime to us. However I submit that this view is completely mistaken. When it comes to income tax, the government imposes levy on the pretax earnings of citizens. When we carefully examine who owns the pretax dollars, we will discover that our pretax dollars do in fact not belong to us, but instead rightfully belongs to the government. Recall the definition of ‘theft’ my opponent suggested in Round 1. In order for taxation to be theft it must concern that one is the rightful owner of the property being stolen. Since the ownership of pretax income lies with the government it cannot be regarded as theft when one retakes what is originally his. Therefore we can conclude that income taxation fails to qualify as theft. Allow me to further elaborate on why this is the case. C1: We have no legal property rights to our pretax income In its very definition ‘theft’ relies on the legal system that defines it. In order for theft to occur, the taking must be unlawful by definition. Legal property only exists by the acknowledgement of the society and enforcement by the law. Legal property right is purely a social construction, in no way reflected in reality. If one lawfully takes, it cannot be theft by definition! Thus my opponent is wrong by claiming that theft can be lawful. The postulation that income taxation is theft further implies that we have a legal property right to pretax income, however this is not the case. Property rights do not precede the law but follow from the law and this law includes income taxation. We do not have the legal right to our pretax dollars, because we are legally obliged by the law to pay tax on our incomes. Under this theory income taxation clearly is not theft, for it leads to a direct contradiction. C2: We have no moral property rights to our pretax income The USA makes use of the dollar as legal tender, authorized by the government. It is a paper currency without inherent worth. This currency is created and distributed by the government and by extension owns it.[4] In the absence of government, we would not have our current money system. And without our money system our income would be nonexistent. Therefore we are not naturally entitled to our pretax income. Our income depends on a government that delivers a system, including public goods and services, infrastructure, security, education and indeed our contemporary currency. This is not the natural state of affairs, the government sustains this system through taxes. The value of the currency is solely dependent on the bigger framework it operates in and relies on. The government, as the creator and thus rightful owner of the fiat currency, sets the terms and conditions, which entails income taxation. It follows logically that pretax income is not our rightful moral property. The initial appropriation would be immoral if we fail to fulfill our duty. Thus when our income is taxed, theft cannot occur, because what is being taken does not belong to us in the first place![5] By analogy, imagine I have an old bicycle which I can sell for a good price at the local bike shop. Unfortunately I do not have enough time to do it myself, but since you have to go to there anyway, I make you a deal. Of course, since I am the moral owner of the bicycle, I can set the terms and condition of the deal, which you then can take or leave. I ask you to deliver the bicycle for me and as reward I let you keep 60 percent of the profits. You accept the deal and successfully sell the bicycle for 100 bucks. Although you now hold the 100 dollars in your pocket, of 40 dollars you are not the rightful owner. When you decide not to return me my part, you break the arrangement. The original acquisition of the 40 dollars would then be immoral, thus not your rightful moral property and therefore still belongs to me. When I then take back the 40 dollars it cannot qualify as theft, because it is mine to begin with. To postulate that one has a moral right to one’s pretax income further implies that the market based distribution is presumptively perfectly just. It presupposes that the market exactly yields what one deserves. However, this is highly implausible. Whatever the market happens to throw up by its economic structure is not morally deserved, because the market is not intrinsically just, but rather amoral. We cannot derive our moral property rights by the mechanism of the market. We are thereby unjustified to claim a moral right to pretax income, produced by the whims of the market.[6] C3: Taxation is not without consent When one chooses to participate in the system, by using the currency delivered by the government, one implicitly enters into a social contract which includes income taxation as well. Earning one’s money necessary concurs with accepting the income taxation, by making use of the currency and (probably) by using other benefits of the system and public goods. You agreed to the terms and conditions by participating in the system through which you acquired your money. For example, imagine your bicycle is broken. You go out to a bicycle repair shop and have your bike fixed. Once your bicycle is repaired the bill is presented. You go out on a limb shouting ‘I did not sign no stinking contract’, because you never explicit stated that you were agreeing to pay for the reparation. However by making use of the services the repair shop offered you consented to the social contract, it is implicated by your choice to sit down and make use of its services. If one does not uphold his side of the contract, his income is immoral acquired property, thus has no moral rights to his pretax earnings. You are not entitled to your pretax income if you fail to bear your burden. Thus when the arrangement is violated by failing to uphold one’s side of the contract, the government is morally justified in taking back what is originally his. This cannot account as theft. One may also argue that taxation is a form of coercion, because one has no other choice to his disposal other than paying taxes and is forced to do so, against their will. However, this is not true because emigration is not forbidden. It can also be argued that taxation is nonvoluntary and one has no say in the matter. This is not true as well. Taxation is established through democratic consent. Moreover, this does not make it wrongful. Imagine for example that you are raised and live in a rented apartment, paid by your parents. They now decide to stop paying for you. What you can do now is pay the rent or leave the house. The fact that you never explicit signed the contract and was born under these circumstances is not a valid excuse. Conclusion: I stand in firm affirmation of the resolution. I eagerly await my opponent’s response. Sources: [4] http://en.wikipedia.org...[5] http://books.google.nl...[6]http://books.google.nl...