The Truth About Frivolous Tax Arguments
This responds to some of the more common frivolous “legal” arguments made by individuals and groups who oppose compliance with the federal tax laws.
- Courtesy of the Internal Revenue Service.
Granted, there is certainly some need for this document. Two years ago, Wesley Snipes attempted to avoid paying taxes using an argument with more holes than a wheel of Swiss cheese. However, as much as Snipes’ argument (and others like it) lack a logical foundation, much of our tax code likewise lacks a proper intellectual basis. Take, for example, a 2007 study by the Tax Foundation that examines the inequality of the return (in government services) that individuals of different income brackets receive on their taxes.
Overall, we find that America’s lowest-earning one-fifth of households received roughly $8.21 in government spending for each dollar of taxes paid in 2004. Households with middle-incomes received $1.30 per tax dollar, and America’s highest-earning households received $0.41. Government spending targeted at the lowest-earning 60 percent of U.S. households is larger than what they paid in federal, state and local taxes. In 2004, between $1.03 trillion and $1.53 trillion was redistributed downward from the two highest income quintiles to the three lowest income quintiles through government taxes and spending policy.
With this kind of system in place (i.e. one that rewards failure and punishes success) it is no surprise that citizens frequently do everything in their power to avoid paying taxes. It is next to impossible to encourage good behavior while lacking consistency in the application of rules, rewards, and punishments. Besides the massive inequality illustrated above, our tax system is frequently in a state of flux. It is a safe bet that the tax code will always be altered with the election of a new President. Some Presidents (Obama) make the mistake of punishing productivity, such as raising taxes for anyone earning over $250,000/year. While some (Bush) attempt to institute populist-oriented changes that are merely designed to buy votes, such as one-time tax refunds which do not encourage production and investment nearly as much as logical and long-term tax reforms.
The solution to the gargantuan problem that is our ineffective, inefficient, and inequitable tax code is to design a code that is built on reason, not politics. By “reason” I mean a tax code that is consonant with man’s nature – in other words, one that respects individual liberty and rewards production. Of course, such reforms are impossible if not coupled with an abolition of the current welfare state. Though to attempt to cut government spending before cutting taxes is an attempt to, as the expression goes, put the cart before the horse. But don’t take my word for it…
I am in favor of cutting taxes under any circumstances and for any excuse, for any reason, whenever it’s possible. The reason I am is because I believe the big problem is not taxes, the big problem is spending. The question is, “How do you hold down government spending?”… The only effective way I think to hold it down, is to hold down the amount of income the government has. The way to do that is to cut taxes.
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