From: Jurriaan Bendien (adsl675281@TISCALI.NL)
Date: Tue Aug 28 2007 - 13:35:10 EDT

What could be concluded from this? "All power to the tax collectors?" A tributary socialism? Seems to me there are a few issues here:

- we ought to distinguish clearly between tax avoidance (legal), tax evasion (illegal) and tax resistance (legal or illegal).
- often the biggest tax havens are within wealthy countries themselves (the articles in fact admit as much).
- we ought at least to ask the question, why should taxpayers pay taxes to governments who use public money for purposes which clearly do not benefit them, with minimal accountability?  (Think of the war in Iraq for example, in the end the cost could be $1 trillion or more)
- although working individuals are liable for payroll tax, in fact that tax is paid by the employer, and is effectively a business cost; thus even if corporations and institutions pay little corporate tax, they still must fund their payroll tax.

It is obviously true that the wealthy often dodge taxes on a large scale, but this should not blind us to the problem of accountability for what is actually done with tax money. The presumption that a better civil society will result if people pay their taxes as they should, is at least an open question. After all, at least one reason why people dodge taxes is, precisely because they cannot see that a benefit accrues to them if they do, and that tax money is not used with requisite accountability. The deeper problems concern the type of taxation, the use of tax money, and the accountability for it.

There are few attempts by Marxists to analyse taxation critically,  which I have always thought rather odd, given that taxes on production alone can represent 30% or so of GDP and that public finance is part of the very core of the state. 

I studied it once in New Zealand and it is quite interesting. Prior to the 1930s, workers there paid no income tax. Then, in the course of the depression, they began to pay an unemployment tax, which was then merged into a social security tax, administered as a separate fund. This fund was in the 1950s merged into the consolidated account, and ceased to exist as a separate fund. The consequence was that specific tax levies were no longer tagged for specific purposes, which in fact meant a reduction of accountability. My impression is that the same phenomenon occurred in different ways in many other countries (though the US still has a separate Social Security Fund). It makes sense to argue that taxes paid by working people should be used for their benefit, according to purposes they agreed with. It doesn't really make sense to part with some of your income on a "no strings" (unconditional) basis. Tax revolts played a key role in the bourgeois revolutions against the absolutist state in Europe. But taxes are just as sensitive an issue amond working people today. 


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