The Case Against the Income Tax

Could America exist without an income tax? The idea seems radical, yet in truth America did just fine without a federal income tax for the first 126 years of its history. Prior to 1913, the government operated with revenues raised through tariffs, excise taxes, and property taxes, without ever touching a worker's paycheck. In the late 1800s, when Congress first attempted to impose an income tax, the notion of taxing a citizen's hard work was considered radical! Public outcry ensued; more importantly, the Supreme Court ruled the income tax unconstitutional. Only with passage of the 16th Amendment did Congress gain the ability to tax the productive endeavors of its citizens.

Yet don't we need an income tax to fund the important functions of the federal government? You may be surprised to know that the income tax accounts for only approximately one-third of federal revenue. Only 10 years ago, the federal budget was roughly one-third less than it is today. Surely we could find ways to cut spending back to 1990 levels, especially when the Treasury has single year tax surpluses for the past several years. So perhaps the idea of an America without an income tax is not so radical after all.

The harmful effects of the income tax are obvious. First and foremost, it has enabled government to expand far beyond its proper constitutional limits, regulating virtually every aspect of our lives. It has given government a claim on our lives and work, destroying our privacy in the process. It takes billions of dollars out of the legitimate private economy, with most Americans giving more than a third of everything they make to the federal government. This economic drain destroys jobs and penalizes productive behavior. The ridiculous complexity of the tax laws makes compliance a nightmare for both individuals and businesses. All things considered, our Founders would be dismayed by the income tax mess and the tragic loss of liberty which results.

America without an income tax would be far more prosperous and far more free, but we must be prepared to fight to regain the liberty we have lost incrementally over the past century. I recently introduced "The Liberty Amendment," legislation which would repeal the 16th Amendment and effectively abolish the income tax. I truly believe that real tax reform, reform that so many frustrated Americans desperately want, requires bold legislation that challenges the Washington mind set. Congress talks about reform, but the current tax debate really involves nothing of substance. Both parties are content to continue tinkering with the edges of the tax code to please various special interests. The Liberty Amendment is an attempt to eliminate the system altogether, forcing Congress to find a simple and fair way to collect limited federal revenues. Most of all, the Liberty Amendment is an initiative aimed at reducing the size and scope of the federal government.

Is it impossible to end the income tax? I don't believe so. In fact, I believe a serious groundswell movement of disaffected taxpayers is growing in this country. Millions of Americans are fed up with the current tax system, and they will bring pressure on Congress. Some sidestep Congress completely, bringing legal challenges questioning the validity of the tax code and the 16th Amendment itself. Ultimately, the Liberty Amendment could serve as a flashpoint for these millions of voices.

I see no difference in visible or invisible [taxes].

I do. I think that when people have to pull cash out of their pockets to feed the federal beast - and they know that the extra $ they pull out is labled "federal tax" that it is much more likely that downward pressure is put on spending than if the tax were an unknown amount and people didn't feel it or see it. So solving or ameliorating the problem of "government spending" must include the method of revenue collection - after all, it is indeed government spending that is the problem. What is the best way to get after the problem?... invisible, unknown taxes???

Speaking of competition, it is indeed a main reason purchasing power will increase under the nrst - when costs are eliminated, a competitive industry reduces price, increases ROI, or increases wages ... all benefit individual consumers, individual investors, or individual workers.

This nation survived on no income taxes before.

This is one of the things pro nrst people say often too. Under the nrst, there is no income tax, personal or corporate, among other eliminated taxes.

I still don't know why you think the nrst is a bureaucratic boondoggle, etc. Will you respond the the questions in post #34 above?

All of the things you indicate are desirable in a tax system are components of the nrst and you have not yet answered my questions from the above post, so it isn't clear why you seem to oppose the nrst.

"... federal citizens have inalienable rights. But exactly what George Mason and later James Madison were afraid might happen to States and State Citizens if they failed to ratify the first ten amendments (the BOR), HAS Happened to the body of federal citizens because they (we!) don't have a Bill of Rights for Federal Citizens that restricts Congress' legislative possibilities against us! ..."

What the opponents of the inclusion of the Bill of Rights were afraid of has happened also; it is commonly believed nowadays that if a Right isn't mentioned in the Bill of Rights, it doesn't exist unless Congress writes a law to create that Right.

The common man now believes that Man creates rights by written law, and that belief can be traced directly back to the Bill of Rights, and the implied power that Congress could do whatever it wanted as long as it wasn't specifically prohibited from doing so.

Yes, I know what the 9th and 10th Amendment say, but how many common men do? All they know is that the Constitution gives them their "Constitutional" Rights.

Well,....There's legal and then there's legal.

There's legal the way you mean it with the consideration of higher law.

And then there's legal the way I mean it, without. And this is the legal that you most often see and the one I was talking about. When such offensive things happen such as the Katrina firearms confiscation, and those guys still have their jobs, there have been no charges brought, it's legal! Ok? If the police won't arrest, and the proscecutor won't bring charges, and the judge won't hear the case, and there is no jury, and there is no conviction and no punishment, it's, what? L.E.G.A.L. Exactly. Does it violate Higher Law? Sure does! But it is legal, like legalized plunder, a term of Bastiat's that Sowell and Williams use all the time.

To explore these issues the way I want, I need to be able to allow for the fact of legalized bad things. Things that are repugnant to the higher-law yet the state does them anyway. I need to call them legal in this manner. I am not suggesting by calling them legal that they are moral or just.

Thanks for the reply.

"What the Founders intended was to create a government that didn't violate the principles they believed in."

I know you are not talking about the federal government! The States were the closest things we had to that, what you said above. They were Republican, steeped in English Common Law, respectful of Higher-Law, respected the Rights of Englishmen. They were a great place for people to live and get along. When disputes arose, the law helped everyone sort them out. Because of slavery, the States were not a great place for kidnapped Africans to live. But that is not what I'm working on here. However, I had to throw that observation in or someone else would have thrown it in for me.

The founders were trying nothing more and nothing less than to create an instrument of government that would perform powers specifically delegated to it by the several states, and refrain from usurping other powers retained by the States and the People. Period.

"What they wanted was a government that would not violate the Rights of men without good cause."

Can you tell me, were we provided with examples what what might constitute a "good cause" to violate the Rights of men? Because without a guide, what you might consider a good cause might to me and my neighbors a bad case of self-dealing.

Our Founders didn't think it was "necessary" to list the Rights government wasn't supposed to violate.

But they did just that in the Bill of Rights and all throughout the Constitution, didn't they? All throughout what the federal government could do and could not do. So they must have thought it necessary. Actually, most didn' t think it necessary, it was George Mason who pushed for the Bill of Rights. Although he was unpersuasive and left disappointed, James Madison was persuaded and managed to persuade the other founders at the Convention to pass the Bill of Rights.

"They expected that, like the existence of Rights themselves, it would be self-evedent that a good government would not itself violate the Rights it was created to defend."

I don't know what you are trying to say here. But here is what George Washington thought about government, good or otherwise.

“Government is not reason, it is not eloquence, it is force; like fire, a troublesome servant and a fearful master. Never for a moment should it be left to irresponsible action.”
George Washington

And again, the federal government was not created solely to defend rights, it was created to perform its delegated responsibilities. And it was placed under restrictions so that it could not molest the rights of State Citizens and States.

The thesis that I have been trying to work on these last few days is that Congress found a tricky way to get around the Bill of Rights. They noticed that their own jurisdiction was created with a "blind spot" where the Bill of Rights did not extend. They had exclusive jurisdiction there and could do pretty much anything they wanted. Anything they did couldn't have hurt anyone much at first because their jurisdiction didn't consist of much. And it had NO citizens. But when they began to get citizens, and lots of them, who lost over time a sense of citizenship to their state that pledging allegiance to the federal flag in schools on state land was now acceptable, and they check U.S. citizen repeatedly over the years, sign federal forms, accept federal benefits, the damage has been done. You are citizen in a jurisdiction that was never designed to have citizens, or even recognize their rights even if it was. And you lack, to borrow a term from computing, sufficient "connectivity" with the State in which you RESIDE, to assert the God Given Rights of a State Citizen. You've dropped your link. In this jurisdiction, Congress is Supreme, and the citizen is reduced to subject having as much standing and hope to influence Congress as English subjects had of influencing the King.

That is my thesis, and it is offered as one possible explanation for the recent behavior of Congress and our President with respect to illegal immigration, and other abuses that seem incongruent with the Constitution.

I hope someone or a few get the idea and try to reestablish connectivity with their State by researching the viability of their State Citizenship, and to restore the link. I believe doing this will allow you to change your jurisdiction to a hybrid federal/state jurisdiction that will allow you to claim more rights. Should another disaster happen, a legal shield of State Citizenship might protect the law abiding gun owner in a way that the confiscation victims in New Orleans didn't have. I'm saying if you are an old woman with a derringer, showing proof of State Citizenship, an affidavit, whatever we come up with, to the thug official there to take your weapon, he might not punch you in your face and knock you to the ground and take your derringer. He might leave you alone.

It continues to amaze me how many on this forum have absolutely zero understanding of the essence of business and economics, value production and freedom.. Let me explain it very simply..

You cannot possibly imagine how infinitely better your life would be if the income tax was abolished along with the IRS...

You do not understand or even recognize the evil of the current chains of income tax slavery that are wrapped around your neck.

Mostly because they have been there since you were born...

You cannot imagine the almost instantaneous boost in business to levels never before seen upon the elimination of the income tax..

You cannot see that the price for practically everything would almost instantaneously drop below whatever price things are now, even with an 18%-23% sales tax added on...

Mostly because you fail to understand the current burden of tax regulations on business, that YOU NOW PAY FOR...

You cannot comprehend the skyrocketing increase in buying power you would instantly have by getting ALL of your hard earned money coupled with the resulting price decreases of practically everything...

You cannot see that the amount of money brought into the government from sales tax revenues would skyrocket above any possible amount brought in due to ANY forced income tax increase...

You cannot imagine the freedom you would have when the government would no longer be able to take your possessions at gunpoint that you have worked so hard for, or lock you up behind bars... Just because you haven't paid your fair share...

You cannot imagine the peace of mind you would have when government minions would no longer be able to snoop in your bank accounts to determine your wealth...

You cannot imagine the investment in free enterprise business that would instantaneously happen, bringing forth untold jobs that would benefit all of society...

It is your complete failure to understand the above that results in your complacency with the current system, and your fear in more freedom for the individual...

But know this...

Those that wish to keep the chains wrapped around your neck DO understand...

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