Freeman

PERSPECTIVE

Fiscal Force

Is the Income Tax Voluntary?

JULY 01, 2010 by SHELDON RICHMAN

I know ev’rybody earns; And I carefully compare it with the income-tax returns;”
—W. S. Gilbert, Princess Ida

April is the cruellest month, for reasons other than what T. S. Eliot had in mind. This is the month in which you must account for yourself to Caesar. The authorities, having relieved you of a goodly portion of your earnings before you even caressed the banknotes between your fingers, now demand you show cause why you should not remit still more.

And in further demonstration of the principle that the citizen in this beloved democracy is the master and the government the mere servant, you are requested to affix your signature beneath these calming words: “Under penalties of perjury, I declare that I have examined this return and accompanying schedules and statements, and to the best of my knowledge and belief, they are true, correct, and complete.”

Those who deem such threats—I mean words—harsh have clearly not visited the friendly IRS website. There you will find much useful information, including the “truth about frivolous tax arguments.” These are the sundry claims that no American citizen is legally obliged to pay the income tax.

The first “frivolous argument” is that the income tax is voluntary: “Proponents point to the fact that the IRS itself tells taxpayers in the Form 1040 instruction book that the tax system is voluntary.” Considering the source of the argument, it might seem something more than frivolous. But, alas, the government subscribes to the Humpty-Dumptian philosophy of language found in Lewis Carroll’s Through the Looking Glass: “‘When I use a word,’ Humpty Dumpty said, in a rather scornful tone, ‘it means just what I choose it to mean, neither more nor less.’”

As the IRS explains, “The word ‘voluntary,’ as used in Flora [v. United States] and in IRS publications, refers to our system of allowing taxpayers to determine the correct amount of tax and complete the appropriate returns, rather than have the government determine tax for them. . . . [T]he court clearly states, ‘although Treasury regulations establish voluntary compliance as the general method of income tax collection, Congress gave the Secretary of the Treasury the power to enforce the income tax laws through involuntary collection.’” And if one should choose not to volunteer to determine the correct amount of tax and complete the appropriate returns?

But I risk frivolity, don’t I? And we all know the penalty for that.

* * *

Why do the anti-globalization protesters always target McDonald’s, but are never seen publicly melting Nestlé Crunch bars or smashing karaoke machines? Christopher Lingle has an explanation, and it’s not very flattering.

Artful exploitation of the news media by anti-capitalist environmental activists has left many people with the impression that manmade chemicals routinely endanger their lives. They’d be surprised by the facts, Angela Logomasini writes.

It’s bad enough using the state to appropriate money from your fellow citizens. Karen Selick says it’s far worse to use it to appropriate character. Criminalizing certain victimless behavior is not just a matter of attempting to control peaceful individuals’ lives. As Joseph Fulda demonstrates, it’s also a policy that by its nature subverts civilized law-enforcement institutions.

Some people refuse to believe — despite all evidence to the contrary — that the world is not going to run out of food. Jim Peron explores the good news that is so hard to swallow.

Have you noticed that hotels give more and more things away for free? They’re not really free; you just pay for them whether you use them or not. Why are they doing that? Ralph Hood knows.

Alas, too many people still claim Keynes as their favorite economist. Et tu, Alan Greenspan? Steven Kates has the scoop. No economist has done more to show that government is not needed to provide education than E.G. West, who died last October at the age of 79. His friend and colleague Charles Rowley pens an appreciation of this distinguished man.

An important untold story is how private enterprise is innovating in the provision of higher education. Keith Wade relates his own experience on both sides of the lectern. The road to serfdom is a state-owned road. How about the road to freedom? Scott McPherson calls for privatization.

A movement is gaining momentum to procure reparations for descendants of slaves in the American South. Stefan Spath valiantly tries to make sense of the case.

American businessmen line up for corporate welfare and give big bucks to organizations that oppose capitalism. A death wish perhaps? William Peterson wonders. Americans are spending less on illegal drugs, and the drug czar celebrates. But hold on, E. Frank Stephenson writes. Economics can shed some light that won’t please the drug warriors.

A provocative set of topics emanates from the word processors of our columnists this month: Mark Skousen ponders how competition benefits religion. Lawrence Reed pays homage to Gladstone. Doug Bandow has timely tips on increasing your taxes. Dwight Lee identifies prisoners’ dilemmas created by the government. Donald Boudreaux compares law and economics. Walter Williams considers the good and bad of monopoly. And Tibor Machan, encountering arguments for the goodness of Social Security, remonstrates, “It Just Ain’t So!”

Books on skeptical environmentalism, an economist’s love of freedom, F.A. Hayek, the Microsoft case, the breakdown of community, and states’ rights — these are what our reviewers report on this month.


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SHELDON RICHMAN

Sheldon Richman is the former editor of The Freeman and TheFreemanOnline.org, and a contributor to The Concise Encyclopedia of Economics. He is the author of Separating School and State: How to Liberate America's Families.

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