Taxes: Why we hate them, why we need them

By Stephan Drew

“We contend that for a nation to try to tax itself into prosperity is like a man standing in a bucket and trying to lift himself up by the handle.”

— Winston S. Churchill

“When plunder becomes a way of life for a group of men in a society, over the course of time they create for themselves a legal system that authorizes it and a moral code that glorifies it.”

— Frédéric Bastiat

“A democracy cannot exist as a permanent form of government. It can only exist until the people discover they can vote themselves largesse out of the public treasury. From that moment on, the majority always votes for the candidate promising the most benefits from the public treasury, with the result that democracy always collapses over a loose fiscal policy — to be followed by a dictatorship.”

— Alexander Fraser Tytler Woodhouselee

We were born and raised in a country created because of a rebellion against taxation but now, it seems, we thrive on it. It’s become a part of our daily lives and our leaders smile with glee when voting on such matters. While shopping for anything, our brains are kept busy, carefully calculating the taxes on each item as we place them in our shopping carts. But there was a time when taxes did not exist. Nowadays, I know that’s extremely hard for us to believe but, it’s true. The first recorded tax was in ancient Egypt, approximately 5,000 years ago and is mentioned in the Bible. Chapter 47 of Genesis describes how the Pharaoh ordered his commissioners to collect one-fifth of all the grain produced by Egyptian citizens. The granaries were filled and the food was distributed as needed to the poor during hard times. This practice spread throughout the Middle East and to Greece. We know this because, in 1799, Napoleon’s army found a stone with 3 different languages written upon it near El-Rashid (modernized to “Rosetta”). The Rosetta Stone contained Egyptian hieroglyphics as well as Greek and Demotic script. It described the coronation of Pharaoh Ptolemy V Epiphanes in 196 B.C.E. The writing details his administrative actions, and goes to great length explaining his new tax laws. Up until this time, no ruler had dared tax the people more than 15-20 percent. This was just one of the many burdens on the ancient Hebrews before the Exodus. In the Old Testament, the Israelites were ordered to pay only 10 percent in taxes and the Bible promised the “wrath of God” on anyone who charged more than that. The Chinese, during the Song and Tang dynasties, had nearly 1,300 tax codes and laws. But, usually, all ancient taxes were anywhere from 5-20 percent. It is estimated that most middle-class Americans now pay between 35 and 45 percent of their income in taxes each year to the state and federal governments. However, income taxes aren’t the only “collection fee” we’re charged. We pay income taxes, sales taxes, use taxes, school taxes, excise fees, service fees, property taxes, sin taxes, travel taxes, capital gains taxes, inheritance taxes, value-added taxes, and hospitality taxes. There are alot more fees paid by certain individuals for specific goods and services but, the ones I’ve mentioned are the 13 types of taxes that most people pay. Once you add it all up, you’re talking about some serious money. It is estimated that, after all taxes, fees, licenses, regulatory costs and all other charges are added up, we actually pay about 60-65 percent of our yearly income in taxes and “fees.” That leaves us around 35 percent of our income to actually live on. From this 35 percent, we pay our monthly bills (food, utilities, etc.), try to save just a little and hope that we have enough left over to survive until our next paycheck. Even still, I have no problem with many of the taxes we pay. Most of these funds are earmarked for a specific good or service that is provided by the government. The only one which really intrigues me is the property tax. Just think about it. You buy a piece of property. You paid for it yourself, the government didn’t. You may wish to build a home on that property and you will pay 100 percent of all the construction costs. However, that increases your property’s value and the government says it will cost you more in property taxes. Why? It has already cost you to purchase the property and to build on it. No government employee helped you cut one board, hammer one nail, paint one room or lay any carpet. Why do they deserve to be rewarded for your cost and effort? The burden has been 100 percent yours. By the way, you also have to buy a permit (“permission”) from your government in order to even begin construction of anything on your property. So you’re not only paying them for work that you’re doing (and paying for out of your pocket) but you’re also paying them for their permission to even do the work, on your own property. No, that I do not understand. However, even with all this, over the past 30 years, our basic taxes have remained relatively normal. But those extra little “fees” our officials like to charge us have steadily increased. That’s why they can look at us with a straight face and say, “Your taxes haven’t really gone up.” No, the “official” taxes haven’t increased. But those extra charges, costs and fees might eat you alive. If you want to test what I’m saying, the next time you see a commercial, just pick up the phone and order the product. It doesn’t matter what the item is, just order it. The commercial says (in plain English), “You ONLY pay $19.99!” Well, pick up the phone and order the product. With taxes, shipping/handling and other fees, the item actually costs you $32.78. That’s a $13.78 (67 percent) increase over the original price. And they actually smile as if they’re doing you a favor by taking your money. They’ll even remind you that you “only paid $19.99.” I suppose the rest is just a “thank you” gift because the “original” price was so cheap? In my opinion, paying $32.78 for a $19.99 item is not a “deal.” That is the society we live in. Very little is what it’s claimed to be. The hype often overshadows the substance. But, in the final analysis, these high costs and taxes are necessary to a certain extent. If we want better roads, new schools and textbooks, improved drainage systems, more cell tower coverage and other goods and services, we should be willing to pay for them. And when the government takes the money and agrees to give us what we request, they have to hire more employees to take care of these added duties and provide these services. These employees have to earn a living so the government has to take in more money in taxes. To collect these new taxes, the IRS has to have more employees, costing more money, and raising taxes that much more. The cycle never ends. They can’t build the roads and schools for free. It costs quite a lot of money to put in new drainage systems. Street lights, clean water systems, safe neighborhoods and all the public utilities we love come at a price. The government gets bigger and bigger and the individual citizen gets smaller and smaller until the government is in total control and the individual has no power (or “say-so”) at all. However, in the final analysis, we must be honest. The reason our taxes are so high is because we want so much. We ask them to fix all of our problems, keep the lights on, feed and educate our children and make sure we have a relatively easy life. When you choose to give over control of your life and responsibilities to the government, it will cost you. Often, the price is higher than you imagined. We may complain about it from time to time but how many of us are willing to do without all these things in order to save some money? We could try it but I really don’t think we would like the outcome.

Author: Rachel Howell

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