Wednesday, April 14, 2010
Taxes in Perspective
I've heard it said, "the only thing worse than paying taxes is not paying taxes." Since it is April 14th, the topic seems appropriate. What is the ideal tax rate and method of collection? Stating the purpose (in my opinion) of taxation seems a good place to begin. I believe that taxes should serve the purpose of funding the activities of government. Somewhere between 0% and 100% of the wealth of the citizenry lies an intersecting point where the essential services (as determined by the governed) of government are funded and the prosperity of the populace is minimally affected. While the nation's properity is dynamic, the value at any given moment is static. If thought of as a pie, over time it may become larger or smaller, but at a moment on a given day, it is 100% of the value that it holds. As that value is consumed for whatever the purpose may be, that which remains is 100% less the value that was consumed. An increase in taxes requires a reduction in one or more of the remaining funded categories. Genesis contains a record of a secular (at least non-Christian) government that became the wealthiest nation on earth in its day through application of certain economic principles including taxation - Egypt. The record revolves around a man named Joseph, son of Jacob, and it begins in Genesis 30:24. Through a series of events, he becomes the most powerful man in Egypt next to the Pharaoh. The record becomes more relevant to this discussion in chapter 41. Genesis 41:34 and 47:24-26 record that he collected the fifth part except in the land of the priests. "The fifth part" implies at least two significant points: (1) the rate was 20%; (2) it was paid by the citizen rather than being seized by the government. Taxation was not the only monetary policy set, but it was the means of collecting revenue. The result is that Egypt became the wealthiest nation on earth in a short period of time. The present day suggested method of collection most closely resembling what I believe Joseph instituted is "The Fair Tax." It would stimulate growth, and over the long term, yield the same result as it produced in ancient Egypt. Strength, prosperity, and liberty result from an unfettered society. I am Juan Freeman.
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