Thoughts on the ethical duty to pay taxes…

D.A. Kirk, thanks for the really thoughtful response. In general, I agree with just about everything you wrote. I do think that there is an ethical limit to how much people should be charged in taxes, and a practical one too. As Arthur Laffer pointed out, at some point, higher tax rates lead to lower revenues as people lose their incentives to work. The problem with quoting Laffer is he certainly did not imply that taxes should always be lowered, just that there is a point at which higher rates lead to diminishing returns. He also didn’t tell us what the appropriate rate was. I think it’s pretty clear that rates right now are too low as evidenced by the fact that we are running huge deficits mostly based upon the cost of things most people support: Social Security, Medicare, Defense.

That said, I do agree with your argument as to the fairest tax: a consumption tax on non-essentials. I also agree that consumers can vote with their wallets, but those votes generally are related to product, not the company’s CSR. If you want to see how corporate largess can dominate the debate over priorities, just look at how Bill Gates has impacted African charities. At this point, our aid to Africa is decided by neither our country nor by the Africans. It is determined by Gates. That is anti-democratic.

Finally, I think most libertarians would support the idea that there is an ethical obligation to pay taxes. While they may argue that government should not be spending so much money on so many things, the things everyone agrees that government should do will be paid for disproportionately by the people who pay the taxes if some others use their power to avoid paying their fair share. I think the question as to what government should be spending money on is legitimate. But once we decide as a society how much to spend, we should pay for it fully and fairly. To me, that should be beyond debate.

Thanks again for the great response. I look forward to discussing these issues with you in the future.

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Mike is an Assistant Professor of Management for Legal and Ethical Studies at Oakland U. Mike combines his scholarship with practical experience in politics.

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