Taxes are the means by which we as a society fund our basic function, which is the protection of our lives, liberties and properties. Our tax structure should also reflect this functionality. Fairness would require that people would pay for what they are receiving.
In that spirit, I would propose that there would be a basic person tax to protect our lives. This would be something that every adult member of the society is required to pay. The liberty tax would cover wars on terror, wars of liberation or armed occupations. This tax should be levied as a pay-as-you-go because it should not remove funds from other necessary protection services.
A tax on property should include all wealth.
To be absolutely fair, we would need a flat tax on all of the possessions we have, because it takes money to protect them. This would include everything, savings, houses, companies etc. The tax rate could be much lower than our current income tax, but your wealth would always undergo taxation.
Most people shudder at this proposal because they don’t consider the cost to society of protecting their assets.
This is most obvious in the flat rate income tax proposals. Under an income tax, society only gets to tax the money once. However, if the money ends up as investments or savings, society is obligated morally and financially to protect that money or principle forever. A flat tax rate is now a burden on those who pay for the protection of other people’s money. The poor are required to pay the same percentage of their income as the rich person, but they have no assets to protect.
A progressive income tax solves some of these problems. Your wealth does not get taxed every year, but the wealthy pay a higher tax rate because a larger fraction of their income will go into long-term savings and investments that society must protect. We must charge the rich up front for that protection. This is fairness.
Glenn Bennett
Boulder
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