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John Simkin

Morality and Income Tax

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In the absence of the forum this week my students came up with the following questions they would like members to consider:

"Is it morally right for top wage owners to pay more than a 40% rate of income-tax?"

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In the absence of the forum this week my students came up with the following questions they would like members to consider:

"Is it morally right for top wage owners to pay more than a 40% rate of income-tax?"

Well, being a Bible-believing evangelical Christian, I believe it is one's duty to not live lavishly and to give whatever one can afford to the poor. Whether it is acceptable for the state to force people to do this is another matter. Forcing people to be 'moral' is not actual morality, is it?

Although morality should (and does) permeate everything we do, taxation in a secular state is not something that all groups will agree upon. Even within a reasonably homogenous group of people with similar belief systems there would be disagreements as to how much we should give (c.f. the minimum tithe of 10% in the Old Testament compared to the almost 30% effective tax due to 'special' tithes)

:plane Doug

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It is morally wrong for several top wage owners to have a way of not paying very much if any tax at all. I believe in progressive taxation up to a certain percent and that all wage earners should be included. This is a basic principle in a society based on solidarity. I also believe that we who pay should have a saying in how this money should be used...

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In the absence of the forum this week my students came up with the following questions they would like members to consider:

"Is it morally right for top wage owners to pay more than a 40% rate of income-tax?"

I do not understand why the level of taxation should be linked to morality. I also do not understand why the level of 40% has been picked (well I do really, you're in the UK aren't you?). Here in Denmark the top level of tax is 61%. Taxation is determined by three tiers of government, state, regional and local and if the three add up to more than 61% then 61% is the maximum you pay. So here the question would be 'Is it morally acceptable for taxation to be above 61%'.

Again though, the figure is completely arbitrary. It is a headline figure which, in the UK, takes no account of National Insurance and Council Tax, things which the Danish tax figure more or less include. It also doesn't take account of indirect taxes like VAT (sales tax) which here in Denmark is very high again at 25% while in the UK itis 17.5%.

What people seem to forget is to look at what you get in return. I feel safer and better looked after here in Denmark than I did when living in the UK. Whether I feel 33% better looked after (difference between Danish tax and UK tax, superficially) I really couldn't say.

I must say I get fed up hearing about people complaining about high tax levels (even accepting that I have done this myself in an earlier post). What people should consider is what you get back in return. I especially have little sympathy with vicars in the UK who object to paying £200 council tax. I was in Lithuania earlier in the year and years of lack of public investment is all too evident in the state of the roads, street lighting and so on. I also get fed up with the argument about people's right to choose because inevitably here they are only thinking of things which affect them personally such as health and education. How many people, left completely to their own devices would set aside money to pay for defence, roads, art and combatting alcoholism? I simply can't imagine any family sitting down to consciously allocate money to these items.

Yes, I think that 61% hurts (and you don't have to be a particularly high earner here to be at that level) but I have this feeling that I get a lot back in return and I doubt I would be here writing to you today if I hadn't been able to avail myself of the excellent child care facilities here. Nor would my children have had such a wealth and diversity of experiences had they stayed at home with me.

I think that a large part of whether you approve of the taxation level or not is related to the level of trust in Government institutions. If there is a high level of incompetence and corruption then any percent taxation could be interpreted as morally wrong.

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I believe that great levels of inequality is incompatible with an effective functioning democracy. For example, a person with great wealth can “buy” media organizations and then attempt to brainwash the population. These wealth individuals can also “buy” politicians. This is one of the major reasons why the American government does not represent the true interests of the people. George Bush has a long record of introducing legislation that benefits those who have donated large sums of money to the Republican Party.

If a society is going to obtain a true democracy the government will need to find ways of reducing the power of wealthy individuals and large corporations. The best way to do this is through the taxation system.

As far as income-tax is concerned, I would suggest that a 60% rate on people earning over £100,000 a year is a fair one. With the extra revenue obtained from this measure you could ensure that people received good quality education and health-care, regardless of their level of income.

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In the absence of the forum this week my students came up with the following questions they would like members to consider:

"Is it morally right for top wage owners to pay more than a 40% rate of income-tax?"

It's nothing to do with morals. If the people in a state want the government to supply top rate services then you have to tax. The Scandinavian countries seem to do it quite well. Of course some smart guys will leave and go and live in the US so they aren't taxed;-)

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For me, the question about tax is really one about whether we see ourselves as belonging to a society which includes everyone, or one which includes only the people we care about.

The latter is very attractive if you're rich. You can live in a gated community and pay for security guards … but what happens when people start getting struck down by bird flu or any other danger which affects rich and poor alike? Even a community of very rich people can't afford to run world-class medical research facilities or top-class hurricane rescue services.

In the end, being rich and low-taxed is only really possible in a world where someone else picks up the bill for all the 'hidden' services which the rich and low-taxed actually consume without knowing they're doing it. If you want to see this type of parasitism as moral, then the definition of 'morality' needs a lot of changing!

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As with most actions of the U.S. Government, the income tax schedules are designed to "create jobs".

MOM=Jobs

Movement of Money=Creates jobs.

The tiered system is designed to create an incentive on the part of those who are in the upper income levels, to invest portions of this income into various investments (of which the Government dictates the tax advantage).

The investment of this capital, prevents the wealthy individual from having to "give" this money to the government and creates a tax reduction/tax break for the individual, while still maintaining a large portion of the actual monies through the investment.

This investment, thereafter creates jobs for the "masses", of whom these persons pay there representative portion of income taxes.

In calculations, the Government takes into consideration the amount of actual Income Taxes which will be received totally from the lower income jobs, as compared to what would have been received had they merely collected the monies from the wealthy individual.

These calculations assist in which "direction" the tax incentive/tax break investments are offered.

Through usage of the tax laws, the U.S. Government can, to a certain degree, direct the investment by the wealthy into those activities which the Government deems as an assist to our economic welfare.

The "Government" is the entity which made it possible for those persons to achieve great wealth.

Creation of laws which, by their nature, force the wealthy to utilize these monies to the benefit of those who have not achieved prosperity, is a legal function and right of any government which understands the necessity for betterment of all of the people.

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I would tend to agree with John S. and Thomas P. - I can see their points of view. Each year I figure my taxes and while I am not happy about how the U.S. government "spends my money" in the main, I am happy to contribute at a rate of about 13 - 15 % across the board.

The way I see it, I am making the "tithe" to "mammon"(in addition to, NOT in lieu of, my tithe to God) - at 10% with another 3 - 5 % for the programs I truly DO believe in.

Any additional contributions that I may make to private or public charities is my REAL tithe.

The Government is more than happy to take their share - and I am happy to give; I am willing to support "social programs" as long as they are used aright.

What is most galling to me is the cases which have blown up in our news in the U.S. - ENRON and the like - in which the perpetrators of theft and fraud seem to "skate" with a slap on the wrist - when, in my opinion, ALL of their "ill-gotten" gains should be ferretted out from wherever those persons have invested / hidden then money, the entire amount seized and returned to the investors and/or the public coffers. From MY point of view, THIS is the area in which "morality" applies, not taxation rates per se.

Just an opinion - certainly not FACT; but from what I "perceive" going on in the world, I thought I would share it here.

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I would tend to agree with John S. and Thomas P. - I can see their points of view. Each year I figure my taxes and while I am not happy about how the U.S. government "spends my money" in the main, I am happy to contribute at a rate of about 13 - 15 % across the board.

The way I see it, I am making the "tithe" to "mammon"(in addition to, NOT in lieu of, my tithe to God) - at 10% with another 3 - 5 % for the programs I truly DO believe in.

Any additional contributions that I may make to private or public charities is my REAL tithe.

The Government is more than happy to take their share - and I am happy to give; I am willing to support "social programs" as long as they are used aright.

What is most galling to me is the cases which have blown up in our news in the U.S. - ENRON and the like - in which the perpetrators of theft and fraud seem to "skate" with a slap on the wrist - when, in my opinion, ALL of their "ill-gotten" gains should be ferretted out from wherever those persons have invested / hidden then money, the entire amount seized and returned to the investors and/or the public coffers. From MY point of view, THIS is the area in which "morality" applies, not taxation rates per se.

Just an opinion - certainly not FACT; but from what I "perceive" going on in the world, I thought I would share it here.

Although I fully concur, and would gladly provide the rope for the hanging, this would not occur in our society.

Our government, not unlike most others, has found that "greed" is a motivator.

Those persons, such as Ken Lay & even Martha Steward, do not "bury" their ill-gotten gains in a jar into the ground. They invest it into other aspects of american business and society.

Again, these investments continue with the MOM (movement of money principal), and continue to create jobs as well.

Were we, as a society, to do as the Chinese have been known to do, and thereafter terminate any who are found to participate in such activities, then obviously, the "Greed Motivator" would be removed (or at least highly curtailed) from the woodpile which fires the economic engine of the country.

Human greed is an excellent motivator. In the early years of the development of this country, it was this greed which fully controlled the direction of politics in the nation.

Although we certainly have not fully weaned ourselves from this, one should look back in our history from the early 1900's through the 1960's to see the progress which has been made.

Our system is that of progressive change for the better. This is why it has survived and continues to progressively provide better benefits and opportunties for each successive generation.

Elimination of the "greed" motivator is not the answer as it is an important part of our society.

Directed control of this motivator is the answer.

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In the absence of the forum this week my students came up with the following questions they would like members to consider:

"Is it morally right for top wage owners to pay more than a 40% rate of income-tax?"

Is it morally right for some people to be paid £200 for 40 hours hard manual labour whilst others are paid many times more than this for a few hours of consultancy?

It is not the amount of tax paid that is the question but the equity of the overall reward for a person's contribution to society i.e. the work that they do.

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In the absence of the forum this week my students came up with the following questions they would like members to consider:

"Is it morally right for top wage owners to pay more than a 40% rate of income-tax?"

Is it morally right for some people to be paid £200 for 40 hours hard manual labour whilst others are paid many times more than this for a few hours of consultancy?

It is not the amount of tax paid that is the question but the equity of the overall reward for a person's contribution to society i.e. the work that they do.

The problem is that it is difficult for government's to restrict wage rates but easy to increase income tax.

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In the absence of the forum this week my students came up with the following questions they would like members to consider:

"Is it morally right for top wage owners to pay more than a 40% rate of income-tax?"

Is it morally right for some people to be paid £200 for 40 hours hard manual labour whilst others are paid many times more than this for a few hours of consultancy?

It is not the amount of tax paid that is the question but the equity of the overall reward for a person's contribution to society i.e. the work that they do.

The basic necessities in life include: Food/Water/& Shelter. (some wish to add in sex)

The "larger" salaries provide the motivation for one who wishes to have the "finer" things in life such as fur coats; automobiles; vacations; big boats; etc; etc; etc.

All of which do not constitute a "necessity" for life.

Therefore, the "greed" and "vain" aspects of human nature are a driving force to many, to achieve this higher paying position.

In turn, they spend these monies, which in turn creates jobs for those of the lower income.

Therein lies one of the primary failures of the totally socialistic, as well as communistic principals of government.

It eliminates what is a natural part of the human species, thereby creating little motivation for advanced achievement.

Therefore, one who has only the "good" of mankind at heart, would achieve whatever his capability and thereafter perform his task for merely those necessities of life (food/water/shelter), without consideration of the financial rewards. And, there are certainly those who do so.

However, one must deal with the realilty of the human species, and not idealogy.

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"Is it morally right for top wage owners to pay more than a 40% rate of income-tax?"

In the Old Testament, when the nation of Israel was clamoring for a king, "like the other nations", the prophet, Samuel told Israel that the king would "take the tenth of your seed, and of your vineyards, and give to his officers, and to his servants."

The clear implication in this passage is that the king's taking this, among other things, was not good and a tenth was in view, not 40%+. I use this as part of my thinking on, "What constitutes a tyrannical government?".

For the government to take the same amount as the church is considered tyrannical.

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The money system is a complete failure. There should be no money, therefore no tax. There should also be no high earners, people should be recompensed with leisure time and other benefits, not accumulated monetary wealth in order to buy unnecessary trinkets and consumer goods.

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