Of course it is an issue of morality. I could choose to avoid paying taxes in the society that I'm a part of. It would be in my economic interest to do so.
But it is morally wrong because it is that same society that enables me to make my money in the first place.
That doesn't make any sense at all. Tax avoidance is perfectly legal. Tax evasion is not. Playing within the rules created by society is not morally wrong. Every deduction you take on your personal income taxes falls under tax avoidance which you can't possibly be describing as morally wrong.
"The legal right of an individual to decrease the amount of what would otherwise be his taxes or altogether avoid them, by means which the law permits, cannot be doubted." - US Supreme Court
Legal and Moral are two, at best, loosely coupled concepts. Just because something is perfectly legal doesn't make it moral. Or for that matter just because something is illegal doesn't necessarily make it immoral.
> Playing within the rules created by society is not morally wrong.
There are people who honestly believe that? It’s not that simple, it really isn’t.
I, for example, think there are many immoral but legal things and I want it to stay that way. The law is not supposed to perfectly mirror our morality, that would be a clusterfuck, tyranny, and otherwise a really bad idea. (For example: I think not tipping in the restaurant is immoral. I, however, never ever want that to become a law. Just one example.)
In short: Just because it’s legal, doesn’t mean it’s right. Just because it’s not right, doesn’t mean it should be illegal.
Taxes are purely a construct of law though. The only reason it's immoral not to pay taxes is because it's immoral to break the law, at least if the law is just. But we're not talking about people breaking the law, we're talking about people obeying the law.
Think of it this way: if you can get an effective tax rate of x% by doing this and y% by doing that, and x < y, what's the moral difference between doing what you need to do to pay x% and the government changing the tax rate so you pay x% either way? It's not a question of what's the most moral percentage to pay in tax, it's a question of whether or not you're defying the law, which you aren't in either case. If the government lowered the tax rate to x% and you decided to cut out the middleman and just pay it, no one would howl at you to voluntarily pay more. So why do people howl at you for obeying other laws that allow you to effectively lower your effective tax rate to the same amount?
The reason it is immoral to pay taxes is that you are still benefiting from the existence of the government but putting the burden of supporting it on others.
You personally may agree or disagree with this, but that's what someone probably means when they say it is immoral to avoid paying taxes, even if it is perfectly legal. Taxes are part of the general social contract of our society, and aggressively finding ways to avoid paying them tends to a tragedy of the commons type situation.
You're thinking at country level. If you expand the thought to global level, the supposed immorality disappears - in this case, the taxes are just paid in another country, at a lower rate, but it still helps a part of society...
> The only reason it's immoral not to pay taxes is because it's immoral to break the law, at least if the law is just
Surely it's also immoral because it's moral to contribute to the society you benefit from, particularly when the laws are constructed to attempt to make you do so, even when there are loopholes?
If it had to do with contributing to the society around you, surely it would be the same obligation regardless of the tax laws, wouldn't it? Yet no one voluntarily pays more than the tax rate, and nearly everyone takes all the deductions and tax credits they can.
Right - the difference between the two is that deductions and tax credits are explicitly entered into the law to define what someone should be paying. The corporate tax rates that Apple pays in California are instead a reflection of the law's inability to effectively extract the money that society wants to - loopholes are involuntarily, while tax deductions are intended.
Of course it's often intended for a tax deduction to be okay. I'm not quite sure what the thrust of your argument is - are you trying to imply that loopholes as a concept are invalid?
The best way I can visualize it is like playing a game of poker.
Bluffing is misrepresenting what you have to fool your opponent into something you don't, or more commonly, something better than you actually have. There are a variety of ways to bluff, with either betting patterns or by outright lying verbally. There are different rules in different casinos that determine whether or not you're allowed to talk about your hand, so exactly how you perform your bluffs may be limited.
Regardless, you should bluff, at least occasionally. The person who never bluffs is likely limited in the amount of money they can make as everyone will fold to the always truthful player.
Ignoring the societal questionability of poker on the whole, some poker players consider bluffing to be immoral. Generally, and certainly the people who recently fell for a bluff might feel so more strongly than those who just successfully bluffed but, and this is important, bluffing is within the rules of the game.
So long as you're not breaking the rules, there is no penalty for being clever.
I agree with the SCOTUS sentiment, but in other related areas, strict adherence to the law with the underlying intent to remain legal but avoid the spirit of the law has been cracked down upon.
In the case of cash transactions, with the 10k reporting limits, people are now routinely prosecuted for "structuring" their >10k transactions into a series of <10k transactions, even when it is clearly demonstrated that there is no underlying criminal activity. There have been cases where it is just cantankerous believers in privacy being prosecuted.
For my part, I'm on the side of the tax avoiders & believers in privacy, but it wouldn't surprise me to see the government's views/regulations on tax avoidance come around to their current policies on currency controls.
It's simple, but there are a lot of people who do not understand this. They don't realize the taxes from the system that funded childhood educations and college tuitions to result in an employable, knowledgeable, creative mass of first-world dwellers should be paid back into through taxes on the profits of the companies in their sphere.
There is a singular lack of realization about the societies in which we live, possibly because it does feel like every man for himself most days. The societal web that makes us interdependent and upon which we rely without knowing it isn't as apparent.
Addendum: there's a lot of confusion about the differences between something being legal and something being moral/ethical in the responses to this post. Legal too often simply means exploiting loopholes.
I'm not sure it's that simple. I live in the US. The vast majority of the US Federal budget goes to the military, income redistribution (welfare) and insurance programs (social security, medicare). I do not believe most of those expenditures enable me to make money, and I think a significant segment is actively harmful. I also feel that I don't have a meaningful say in how that money is used because the political system is broken.
Given those conditions, I don't feel there's anything immoral about doing everything legal to pay less in taxes. I suspect things are different where you live.
Exactly.. lets first talk about the morality and ethics behind the govt. spending MY hard-earned dollars to go bomb brown people in the middle of the desert for 20 STRAIGHT YEARS.
I'm not saying I agree with all of it in practice, but there's a strong argument against your thoughts here, especially in principle.
The military keeps foreigners from invading/suicide bombing and thus creates stability which lets you make money. Social safety nets including welfare, social security, etc, create the same sort of stability since there's less of a likelihood a starving person or angry elderly woman will rob you, etc, etc.
Right, but they may not be the most effective means to do so. If I mow your lawn, then break into your house to steal $20, I might justify that on the grounds that your mowed lawn is worth $20. But in most sensible economic relationships, we do things in the opposite order: figure out if the service is worth the cost, and then perform it in exchange for payment.
I'm not saying having a military isn't valuable. I'm saying the US spends more on its military than the next ten countries put together and maintains a foreign policy of intervening in affairs of other countries and regions. I do not believe these things are necessary to defend the country, and may actually endanger us by creating new enemies.
I'm not saying social safety nets aren't valuable. I'm saying that the current implementation does little to encourage or help people who use them to move on to something productive. I'm also saying that social security is an unsustainable pyramid scheme and that medicare is both inefficient and a poor allocation of resources.
I don't necessarily have solutions in mind for the latter problems; they're hard problems and not in a field with which I have experience. What I am saying is that I don't feel obligated to pay any more in taxes than I have to when on the order of 90% of the money will go toward things that I believe aren't constructive.
Thoreau came to the same conclusion. "I don't support war, so I'm not going to pay taxes." This, however, isn't a tenable practice for society as a whole.
If I live off of my savings, and generate no taxable income, am I also immoral for driving on roads? What if I work part-time, but pay less in taxes than the average person? Once you have a theory that it's morally wrong for people not to pay taxes given that they benefit from the government, you run into the problem that the most effective tax avoidance scheme, by far, is to not have anything taxable.
Oddly enough, New York has implemented an effective Henry George-esque tax system: to merely exist in the city, you have to live in fairly pricey real estate, and the taxes your landlord pays are effectively passed through to you by market rents. Other places have much cheaper real estate, so they don't have the same dynamic.
But it is morally wrong because it is that same society that enables me to make my money in the first place.
Simple, right?