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Voluntary Taxes? Give me a break.

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fourthand1 Posted: Fri, Feb 11 2011 1:39 PM

I have to let off some steam:

A guy on sports message board that I frequent explains that sales tax are voluntary. His argument is that you must choose to purchase goods/services, and if you do then you agree to the sales tax. Therefore it is a voluntary tax.

My reply:

This is a ridiculous statement. All taxes are coercive by their very nature. If businesses do not pay their taxes they are threatened with violence in the form of fees, jail time, or being shut down completely. So it's not exactly voluntary for them is it? 

To say that any tax -- federal income, state/local sales, etc -- is voluntary is outrageous. 

I don't know much about your background, but I'm guessing that a name like "political hack" and a picture of the capitol building means you are part of the ruling elite class in Washington so naturally you would be an advocate of taxes.

Anything else I should add?

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fourthand1:

I have to let off some steam:

A guy on sports message board that I frequent explains that sales tax are voluntary. His argument is that you must choose to purchase goods/services, and if you do then you agree to the sales tax. Therefore it is a voluntary tax.

My reply:

This is a ridiculous statement. All taxes are coercive by their very nature. If businesses do not pay their taxes they are threatened with violence in the form of fees, jail time, or being shut down completely. So it's not exactly voluntary for them is it? 

To say that any tax -- federal income, state/local sales, etc -- is voluntary is outrageous. 

I don't know much about your background, but I'm guessing that a name like "political hack" and a picture of the capitol building means you are part of the ruling elite class in Washington so naturally you would be an advocate of taxes.

Anything else I should add?

 
Don't forget death, which is what will happen to either the business owner or a state goon, if the owner doesn't agree to the "voluntary taxes".
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Clayton replied on Fri, Feb 11 2011 1:53 PM

Slaveowner: "You have chosen to run away. You knew that you would be punished for trying to run away. Hence, you will be punished by your own free choice. I can whip you or drag you behind a horse. Your choice. You chose to be punished and now you will choose what sort of punishment it will be. I don't believe in forcing people to do things they don't want to do, so I want to be sure you are punished voluntarily and in the way you choose to be punished."

Slave: "Huh?"

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That is the medical definition of voluntary.  If I hit your knee with a hammer and your leg pops up, involuntary.  If I ask you to raise your leg and you raise it, voluntary.

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That's about the gist of it, Clayton.

What I find more interesting about the so-called "sales" tax is that it is not a tax on sales, at all.  It is a consumption tax.  Businesses make YOU pay it.  If it's a sales tax, that means they are forcing you to pay their taxes if you want their services.

It's really a consumption tax that goes directly to the consumer.

In States a fresh law is looked upon as a remedy for evil. Instead of themselves altering what is bad, people begin by demanding a law to alter it. ... In short, a law everywhere and for everything!

~Peter Kropotkin

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Esuric replied on Fri, Feb 11 2011 3:04 PM

Businesses make YOU pay it.  If it's a sales tax, that means they are forcing you to pay their taxes if you want their services.

?

"If we wish to preserve a free society, it is essential that we recognize that the desirability of a particular object is not sufficient justification for the use of coercion."

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A business could just say "cost; $5.06."  But they don't.  It's "$4.99 + tax."  THEY are not paying the tax, the consumer is.  And the business makes no bones about the fact that THEY are not, in fact, paying the tax.  It is, as any kind of sales tax would be, a tax on the consumer.

I'm sure I could put this in rightist rhetoric and you would understand it better... something about "shifting the burden onto the consumer" or something like that.

In States a fresh law is looked upon as a remedy for evil. Instead of themselves altering what is bad, people begin by demanding a law to alter it. ... In short, a law everywhere and for everything!

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The seller pays the sales tax.  End of story.  The consumer pays higher prices as increased marginal costs raise the profitable price floor.  As for price labelling, see the tax code.

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The consumer pays higher prices as increased marginal costs raise the profitable price floor.

That's really the same thing.

From the California BoE:
 

  1. Can I collect sales tax from my customer?

Yes. Although you are required to pay and report sales taxes to the Board, you may be reimbursed by your customer for the amount of tax you owe on a sale. For example, if you are required to pay $1.75 in sales tax on a sale, you may pass that cost on to your customer, provided it is agreed to as part of the sale. It is presumed that the customer agrees to pay the addition of the tax if:

  • You list a separate amount of sales tax reimbursement on your receipts or invoices;
  • You post a sign on your premises stating that sales tax reimbursement will be added to all prices of taxable merchandise, or make a similar statement on price tags, advertising material, and other printed material directed to the purchaser; or
  • The sales agreement specifically calls for the addition of sales tax reimbursement.

If you include sales tax reimbursement in your prices, rather than itemizing it separately on your invoices or receipts, you must inform the buyer that tax is included. You can post this information at your premises in a location that is visible to purchasers; or you can include it on a price tag or in an advertisement (whichever is applicable). Use one of the following statements:

  • All prices of taxable items include sales tax reimbursement computed to the nearest mill; or
  • The price of this item includes sales tax reimbursement computed to the nearest mill.

In States a fresh law is looked upon as a remedy for evil. Instead of themselves altering what is bad, people begin by demanding a law to alter it. ... In short, a law everywhere and for everything!

~Peter Kropotkin

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Esuric replied on Fri, Feb 11 2011 3:44 PM

The government forces you to pay the tax, not businesses, and consumption taxes reduce QD and therefore profits. Taxes hurt both producers and consumers. Do you understand?

"If we wish to preserve a free society, it is essential that we recognize that the desirability of a particular object is not sufficient justification for the use of coercion."

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DD5 replied on Fri, Feb 11 2011 3:50 PM

Epicurus ibn Kalhoun:

The consumer pays higher prices as increased marginal costs raise the profitable price floor.

That's really the same thing.

 

If you mean that the consumer is hurt by the sales tax, then you are right.  But that's not the same thing as saying that the incidence of taxation fall on consumers.  It doesn't.  It falls directly on all wage earners since the added cost per sale decreases their marginal value productivity.  As for consumers, they are injured indirectly only on account that the lower productivity (less goods) results in higher prices for those things the consumers most urgently want.  The thing about taxation is that this incidence on wage earners is not uniform, and some wage earners can even gain if they are the recipients of the government spending resulting from those taxes.

As for the businessman, he also is hurt as a consumer, and whether he is hurt as a wage earner depends on his line of business and how government spends the proceeds.  As for profits, they are not affected in the aggregate .  Profits arise only on account of successful speculative action.  Taxes on sales affect profits only initially when they are introduced disarranging the current share of total profits in the system.  Some will gain and others will loose.

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Describing raising prices to offset costs as tax collection is equivocation.  A bank is a tax collector because interest rates are higher than they would be without monetary policy.  A factory worker is a tax collector because wages are higher than they would be without payroll tax.  Everyone is a tax collector in the idiotic bureaucrat language.

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The government forces you to pay the tax, not businesses, and consumption taxes reduce QD and therefore profits. Taxes hurt both producers and consumers. Do you understand?

The government forces the business to pay the tax.  So the business forces its consumers to pay it for them.  I never said the tax was helping the business owner.  Did you notice you just called it a consumption tax?

Once again, see the quote from Cali I provided: "can I make my customers pay the tax?"  "Yes but you must tell them they are paying the tax."  It is a tax on consumption, levied on the merchant for ease of collection (otherwise they would make you save all of your receipts for them to go over at the end of the year.  And they know that would never fly, nor would they want to do that much work)

If you mean that the consumer is hurt by the sales tax, then you are right.  ....  It falls directly on all wage earners since the added cost per sale decreases their marginal value productivity.

Correct.  This is basically what I was saying.  I guess I just don't phrase myself well, around here. 

In States a fresh law is looked upon as a remedy for evil. Instead of themselves altering what is bad, people begin by demanding a law to alter it. ... In short, a law everywhere and for everything!

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Conza88 replied on Fri, Feb 11 2011 4:42 PM

"Those who claim that taxation is, in some mystical sense, really "voluntary" should then have no qualms about getting rid of that vital feature of the law which says that failure to pay one’s taxes is criminal and subject to appropriate penalty. But does anyone seriously believe that if the payment of taxation were really made voluntary, say in the sense of contributing to the American Cancer Society, that any appreciable revenue would find itself into the coffers of government? Then why don’t we try it as an experiment for a few years, or a few decades, and find out?"

http://www.lewrockwell.com/rothbard/rothbard24.html

 

"The idea that taxation is voluntary seems to be endemic among economists and social scientists, though hardly so among the general public. [19]  But if an individual refuses to pay his assigned tax, coercion will be wielded against him, and if he resists the confiscation of his property he will be shot or jailed. Failure to pay taxes subjects one to civil and criminal penalties. There should be little need to pursue the matter beyond this, were not economists determined to deny this patently obvious fact."

http://www.lewrockwell.com/rothbard/rothbard36.html

Ron Paul is for self-government when compared to the Constitution. He's an anarcho-capitalist. Proof.
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Spideynw replied on Fri, Feb 11 2011 4:44 PM

fourthand1:

I have to let off some steam:

A guy on sports message board that I frequent explains that sales tax are voluntary. His argument is that you must choose to purchase goods/services, and if you do then you agree to the sales tax. Therefore it is a voluntary tax.

My reply:

This is a ridiculous statement. All taxes are coercive by their very nature. If businesses do not pay their taxes they are threatened with violence in the form of fees, jail time, or being shut down completely. So it's not exactly voluntary for them is it? 

To say that any tax -- federal income, state/local sales, etc -- is voluntary is outrageous. 

I don't know much about your background, but I'm guessing that a name like "political hack" and a picture of the capitol building means you are part of the ruling elite class in Washington so naturally you would be an advocate of taxes.

Anything else I should add?

The business owners are the ones that pay the tax.  They just pass the cost on to their customers.  So ask him if it is voluntary for the business owners to pay it.

At most, I think only 5% of the adult population would need to stop cooperating to have real change.

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  • The business owners are the ones that pay the tax.  They just pass the cost on to their customers.  So ask him if it is voluntary for the business owners to pay it.

Well the buisness owners obviously are deciding VOLUNTARILY to sell stuff to people...huurrrrrrrrrr.....

Just watch Harry Reid stumble over this shit:

http://www.youtube.com/watch?v=R7mRSI8yWwg&t=0m20s

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Clayton replied on Sat, Feb 12 2011 1:21 AM

They just pass the cost on to their customers.

Actually, there's a range over which the burden of a sales tax (or VAT) is shared between the buyer and the seller. On one extreme, sellers may see the entire burden of the tax come out of their profits. On the other extreme, buyers may find the entire burden of the tax falling on their shoulders. Most of the time, the real-world effect lies somewhere between these extremes. It all depends on the relative elasticity of supply and demand for the good in question.

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If you have a registered business you do not pay the VAT on goods that you buy. If you pay the full price you can claim that VAT back from the government or in some cases you do not even need to pay the full price, just keep a record of the transaction. Every registered business has to pay tax on their sales. They pass that on to the consumer in the form of a higher price. In some cases if the VAT is increased the business can choose to not increase the price and take the VAT increase as a reduction in profit. But usually when there is a VAT increase businesses increase the price so they do not pay the sales tax.

There is a different theory that people have said that there is no actual law that says you have to pay income tax and that the law is invalid and they have written books about this. They say that paying taxation is voluntary and then they say that they have read the income tax code all 22000 pages and can not find any evidence that you have to actually pay income tax. For example Sherry Peel Jackson:

http://www.youtube.com/watch?v=c1jqLximBZI

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Eric080 replied on Sat, Feb 12 2011 4:40 PM

Hey, just consult Harry Reid on the matter:

 

 

Even though he's talking about the Income Tax, the same logic applies.

"And it may be said with strict accuracy, that the taste a man may show for absolute government bears an exact ratio to the contempt he may profess for his countrymen." - de Tocqueville
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Lyle replied on Sat, Feb 12 2011 4:51 PM

Any tax not paid which jeopardizes life, liberty or property is a tax that is not voluntary, but mandatory.   One cannot buy the necessities for life without paying a sales tax.  Therefore, the sales tax jeopardizes life and is coercive by its nature.  That one will pay the tax in order to preserve life does not make the tax any less coercive or make it voluntary.

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replied on Sun, Feb 13 2011 2:49 AM

If you assume government to be owner of all land in their territory(which they effectively are due to monopoly on violence), then there is little, if anything un-propertarian about asking for taxes as a condition of use of the property.

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mahall replied on Sun, Feb 13 2011 3:01 AM

If you assume government to be owner of all land in their territory(which they effectively are due to monopoly on violence), then there is little, if anything un-propertarian about asking for taxes as a condition of use of the property.

The abolishment of private property rights is communism. You can't say "there is nothing un-propertarian" about tax in this instance since your first sentence eliminated the possibility of propertarian society.

You can't hurry up good times by waiting for them.

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replied on Sun, Feb 13 2011 3:30 AM

Yes, government isnt actively managing all its property like in communist states, however it effectively is the owner. As its known interventionist capitalism is a more productive way for states to farm their wealth than outright socialism, hence the more delicate, calm ways of states getting dividends from their property. The similar idea that Molyneux presented http://www.youtube.com/watch?v=Xbp6umQT58A

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Eric080 replied on Sun, Feb 13 2011 3:51 AM

Yeah, that's the whole point though; we don't recognize the State as an owner of land.  If they own a chunk of untouched land in Northern Alaska, then I claim Antartica (actually States have already done that as well).  It controls the land, but it didn't acquire ownership of the land the same way every other human being in the country is able to own something.

"And it may be said with strict accuracy, that the taste a man may show for absolute government bears an exact ratio to the contempt he may profess for his countrymen." - de Tocqueville
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mahall replied on Sun, Feb 13 2011 4:07 AM

xarthaz,

I understand. Your post implies that taxes are justified since the state is the effective owner. My position, however, is that taxes are never justified. Taxes are fundamentally different than service fees.
 

You can't hurry up good times by waiting for them.

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MaikU replied on Sun, Feb 13 2011 4:25 AM

Exactly. For there to be a similarity, one must have a written contract with the state to pay them taxes for those services. No contract, no service. It's just implied "tacit consent" or "social contract" which is...see my signature.

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(english is not my native language, sorry for grammar.)

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What I find more interesting about the so-called "sales" tax is that it is not a tax on sales, at all.  It is a consumption tax.  Businesses make YOU pay it.  If it's a sales tax, that means they are forcing you to pay their taxes if you want their services.

It's really a consumption tax that goes directly to the consumer.

This is wrong. It's a tax on businesses. The people who would buy at the +8% price would have bought anyways, but the business loses all the people who would only buy at the +7% or less price.

Individuals miss out on the externality of saving they would have encountered by downward competition among sellers, but no individual who buys with sales tax was unwilling to pay that price anyways.

I will break in the doors of hell and smash the bolts; there will be confusion of people, those above with those from the lower depths. I shall bring up the dead to eat food like the living; and the hosts of dead will outnumber the living.
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replied on Sun, Feb 13 2011 8:05 AM

Exactly. For there to be a similarity, one must have a written contract with the state to pay them taxes for those services. No contract, no service. It's just implied "tacit consent" or "social contract" which is...see my signature.
Its the same as implicit agreements in any commercial area, ie paying money for riding on a private road or crossing a toll bridge etc. The only difference is whether the method of attaining ownership is justified. The use of aggression is not the argument, the justification of ownership is. Hence describing libertarianism as voluntarist is absurd, voluntarism is purely an anarcho-communist term. Theres nothing voluntary about aggressively enforcing a piece of land as your own.
Yeah, that's the whole point though; we don't recognize the State as an owner of land. If they own a chunk of untouched land in Northern Alaska, then I claim Antartica (actually States have already done that as well). It controls the land, but it didn't acquire ownership of the land the same way every other human being in the country is able to own something.
State is taxing (virtually)everyone doing everything in its land, so the rights are actively enforced, not meaningless selling of moon or mars land.

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mahall replied on Sun, Feb 13 2011 3:53 PM

Its the same as implicit agreements in any commercial area, ie paying money for riding on a private road or crossing a toll bridge etc. The only difference is whether the method of attaining ownership is justified. The use of aggression is not the argument, the justification of ownership is. Hence describing libertarianism as voluntarist is absurd, voluntarism is purely an anarcho-communist term. Theres nothing voluntary about aggressively enforcing a piece of land as your own.

Service fees are not the same as taxes.

If the use of aggression is not the argument then why debase voluntarism on it's inherent use of defense?

How is voluntarist a communist term? Voluntary exchange is the free market - the proverbial opposite of communism.

You can't hurry up good times by waiting for them.

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Joseph F replied on Sun, Feb 13 2011 4:30 PM

Sales taxes do not go directly to the consumer.  The market price of any good necessarily includes the sales tax.  That is, if consumers are willing to pay $5 for a product, but there is a $1 tax on that product, then the income going to the producer is $4.  It is the producer that absorbs the loss caused by the imposition of a tax on the product.  Ultimately, the additional costs of production incurred by the producer gets passed down to the original factors of production; that of land and labor.  

Let's say that a business sells widgets for $5, as that is the market price for that widget.  All of the producers costs are in line with this selling price, and the producer yields a profit of about 5% of his total income.  Now, let's say that the government imposes a sales tax of 20% (or, $1 on that $5 widget).  Obviously, the funds to pay this tax must come from some source.  If the producer decides to pass that additional cost onto the consumers, then the price of the good will now be $6.  However, assuming that the demand curve is not perfectly inelastic, the demand for widgets must necessarily decrease, and along with it the profits of the producer.  The most easily understandable proof of this is that if the producer were able to sell his widgets at $6, then he would have already been doing so before the imposition of the sales tax.  Remember, it is the consumers that determine the ultimate market price of any good, not the costs incurred by the producer.  If it costs a producer an exorbitant amount of money to produce a good, it does not follow that he can then charge an exorbitant price for his goods.  If he does attempt to charge a high price due to his costs, the consumers do not have to purchase them, they will simply save that money, invest it, or purchase other goods instead.  

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Anarcho replied on Sun, Feb 13 2011 5:10 PM

"Hence describing libertarianism as voluntary is absurd, voluntarism is purely an anarcho-communist term.  Theres nothing voluntary about aggressively enforcing a piece of land as your own."

 

Voluntarism spans across many ideologies from anarcho-capitalism to anarcho-communism.  It is often used synonmously (correctly or not) with anarcho-capitalism but can be used to describe anyone who believes simply that all human association should be voluntary as much as can be possible.  Voluntaryist hence oppose the intiation of aggression or coercion.

"It is easy to be conspicuously 'compassionate' if others are being forced to pay the cost." - Murray N. Rothbard.

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Spideynw replied on Mon, Feb 14 2011 11:56 AM

xarthaz:

If you assume government to be owner of all land in their territory(which they effectively are due to monopoly on violence), then there is little, if anything un-propertarian about asking for taxes as a condition of use of the property.

First of all, the government does not claim to own the land.  Second of all, even if it did, what business threatens to throw you in a cage for life for not paying, besides the government?

At most, I think only 5% of the adult population would need to stop cooperating to have real change.

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First of all, the government does not claim to own the land.  Second of all, even if it did, what business threatens to throw you in a cage for life for not paying, besides the government?

I don't think prison is even legitimate for real criminals, much less some guy sitting on his porch smoking crack. Pretending they did own all the land they could sue him and deport him, they could not cage him for some period of time (though they could obviously restrain him if he was a standing threat).

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Wibee replied on Mon, Feb 14 2011 8:15 PM

Ad hominems does not promote a healthy debate.  Neither is the tone of your reply.  Just say " If businesses do not pay their taxes they are threatened with violence in the form of fees, jail time, or being shut down completely." and move along.  The rest is incedinary.  

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Contrary to Senator Reid, even using the medical definition of voluntary for payment, even if you don't go to jail, not paying will simply result in armed expropriation.

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dude6935 replied on Mon, Feb 14 2011 10:34 PM

This is wrong. It's a tax on businesses. The people who would buy at the +8% price would have bought anyways, but the business loses all the people who would only buy at the +7% or less price.

Individuals miss out on the externality of saving they would have encountered by downward competition among sellers, but no individual who buys with sales tax was unwilling to pay that price anyways.

 

Excellent answer.

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