by Harry Browne, on April 15, 2003
Someday, I hope, April 15th will no longer be Tax Day (the day your income tax return must be filed) but instead will be known as Freedom Day – a day to remember the huge, expensive, intrusive, and meddling government that once was and that we should be on guard against forever.
That can come only after we repeal the income tax and reduce the federal government to a size that can subsist on just the tariffs and excise taxes already being collected. No flat tax, no “fair” tax, no replacement tax of any kind – because government has been made so small an income tax is no longer needed to finance it.
Impossible?
Not at all.
A Little History
Many people aren’t aware that America – conceived in liberty in 1776 – didn’t have a permanent income tax until 1913. In fact, the Constitution of the United States prohibited an income tax.
For over a century, the U.S. government survived quite well without an income tax. It operated a small, constitutional government on the revenue from tariffs and excise taxes.
Tariffs are taxes imposed upon imported products, and excise taxes are imposed at the manufacturing level on domestic products. Because those taxes affect the prices of products, they were self-limiting. That is, the taxes couldn’t produce unlimited revenue to the government.
If a tax was raised too far, the product would be priced out of the reach of the consumer, sales would fall, and the tax revenues would fall.
Thus, relying on tariffs and excise taxes, the U.S. government was able to raise only so much money and no more. The same was true of state and local governments: there were built-in limits to how much they could tax.
As a result, in 1913 federal, state, and local governments combined took in taxes only 8% of the national income.
But that changed quickly with the passage of the 16th Amendment, authorizing an income tax. In contrast to tariffs and excise taxes, income-tax rates can be raised upward and upward and upward, since most people can’t choose to stop working in order to avoid the tax.
That meant the federal government now had virtually unlimited resources to do whatever the politicians wanted. Respect for the Constitution disappeared almost overnight. The U.S. government plunged the nation into World War I, a strictly European war, something it couldn’t have done without the income tax to finance the war effort. (The top rate quickly zoomed upward to 77% from 7% where it had been set in 1913.)
Today governments at all levels take 47% of the national income. That means you work nearly half your life to support the welfare state. And now there’s no topic on which the politicians refuse to consider legislation. Your entire life is fair game for them to enact rules.
Benefits
Imagine what would happen if we repealed all forms of federal income tax – including the personal income tax, the corporate income tax, Social Security, the estate tax, and the gift tax. A world of benefits would quickly come in the wake of repealing these taxes.
The first benefit is the most obvious: all the money you’re paying in income taxes will be yours – to spend, to save, to give away as you see fit, not as the politicians think is best for you, best for the nation, and – most of all – best for them.
You are the one who gets up every day to go to work. You’re the one who puts in long hours. You’re the one who makes your job what it is.
What have the politicians done to earn that money?
Absolutely nothing.
What claim should they have on your earnings?
Absolutely none.
When we repeal the income tax, all that you pay now in income and Social Security taxes will be yours at last – to do with as you see fit.
If yours is the average American family, that means over 10,000 dollars a year that’s been going to the politicians that will stay in your hands.
Every dollar you earn will be yours – to spend, to save, to give away as you see fit – not as the politicians think best for you, for the nation, or for themselves.
They won’t have a claim on a single dollar you earn.
So what will you do with that money when they no longer take it away from you?
- Will you put your children in private schools – where you could get exactly the kind of education you believe best for them? No more wondering why more time is spent learning to be a good citizen than learning about history, geography, reading, ‘riting, and ‘rithmetic. No more fighting the Board of Education to try to get the curriculum changed. You pick the school that fits your idea of what a school should be.
- Will you start that business you’ve always dreamed of?
- Will you move into a better neighborhood, take your family on a better vacation, arrange a much more comfortable and much more secure retirement?
- Will you help your church or your favorite cause or charity in a way you’ve never been able to do before?
What will you do with that money?
At last, it will all be yours – and the government will no longer have a claim on it.
Other Benefits
That in itself is reason enough to want to end the income tax. But here are three additional benefits:
- There will be a similar increase in take-home pay for everyone you do business with – your customers or your employer – meaning that people will have more money to spend on what you have to offer.
- A similar increase in take-home pay will occur throughout America, unleashing the biggest boost in prosperity that America has ever seen. There will be a job for everyone who can work and charity for everyone who can’t.
- Your life will be your own again: an end to government snooping into your finances, an end to keeping books for the IRS, an end to fear of an audit, an end to rearranging your financial life to minimize your tax burden.
And there’s a fifth benefit that’s probably the greatest of all: No longer will the federal government have the resources to run our lives. It will be unable to continue ruining what was once the best health-care system the world has ever known, destroying American education, making millions of people dependent on welfare, subsidizing foreign dictators and meddling in explosive foreign affairs.
Our Chance
Repealing the income tax is the issue on which we can rally Americans to cut government truly to the bone – the bone being the functions authorized in the Constitution. Without the resources to meddle in our lives, the government will have to withdraw to the limits of the Constitution.
There isn’t space here to cover all the ramifications, objections, and possibilities surrounding this subject. But the rewards it offers provide an opportunity to reach all Americans with a message of a better life – leading perhaps to a better day, when we celebrate Freedom Day instead of Tax Day.
Harry Browne (RIP 1933-2006), the author of Why Government Doesn’t Work and many other books, was the Libertarian Party presidential candidate in 1996 and 2000, a co-founder of DownsizeDC, and the Director of Public Policy for the American Liberty Foundation. See his website.
Very true but there is something far more it would do, it would create incentive to achieve ideas instead of the incentive to steal which is what debt does and when others are allowed to put you in debt for their stealing will the stealing only become bigger. It is not really the money they are stealing, it is what the money represents that is stolen.
It is our effort towards achievements to make life better for us that is robbed from all communities. Thus the starving of communities and the creations it can bring. Life creates achievements and makes them possible through the choices we each make and when we make poor choices to be taxed shall we find ourselves stolen from.
The thieves in 1913 the Federal Reserve and their creation of debt at your expense by robbing you of all your effort while they sit by and watch.
It is not money that creates wealth (thats the robbing) it is great creations, learned choices and activities and the wealth of great achievements that cause communities to Thrive, grow and expand themselves. The exchange we use is what we decide to represent our efforts as or with. Those imposing their poor ideas of 5000 year old symbolism have never produced a thing but theft, while you have produced every other idea you can experience. They claim authority and we claim to be free but neither is true is it?
We only become free when we free ourselves from their 5000 year old ideas of a Rule way of Life, where money is power and wealth is stolen or extracted from all those who produce the rest of experiences. This is done through Law, Taxes, Finance, Debt, secrecy and an over abundance of complicated symbolism to distract you from you.
LIFE creates ideas and makes decisions, both good and bad. These folks are using bad ideas from 5000 years ago by your own agreement and decisions through a manipulation of symbols.
To create good ideas we must look at the ideas that support US as LIFE and choose the direction that best supports this idea. A Republic way of LIFE is WE the LIFE of these communities supporting ourselves by our ideas, our decisions, activities and our accomplishments that provide sustainment and growth. It is intended to be done through the energy of LIFE (ideas and choices), Public and Politics all one in the same in an organized manner of self support. The ideas that support this direction are simple; LIFE (above all) to achieve LIBERTY (our freedom from 5000 year old bad ideas) for the reasons to PURSUE our dreams, our achievements of full on sustainment and growth both which brings us HAPPINESS by our own examples of success by a JUST people (ownership of our own actions, responsibility), forthcoming (the revealing of all things done) in A Community setting. This by definition is the true well researched definition of A Republic and not the perverted versions from many who have attempted to obscure it.
In simple choice there are only two of these directions, one in support of life and the other in the control of life.
The Republic way of life is all activities to support itself as a community. The Rule way of life is to authorize itself as the Ruler over Life, to control it to its self destruction by its own ignorance of itself as life by viewing itself as God over all life or the authority. Yet when we ask ourselves who actually decides for us we know full well it is I. The I in connection with LIFE becomes WE as in WE in this LIFE experiencing.
If WE continue to use the 5000 year old ideas to reach our own ideas will we only reach their ideas. The idea that we need money to Achieve happiness is a false idea. The idea we need wealth of money to be happy is a false idea. The idea we needs laws to direct us is false ideas. The idea we need secrecy to secure us is a false idea. The idea we need others to Govern US versus US Governing ourselves is a false idea. The idea that only some are experts in economic theory is a false idea and by going into agreement with any of these ideas and deciding upon these will always bring us to the Rule way of life as the direction of their intention and their objective. Someone else’s idea, someone else’s dream of what life should be.
Wisdom is achieved over time through experiences and has nothing to do with symbols at all. It is the things we experience that become the knowns by the results we are able to view, review and base our choices on. This is why as we get older many start making far better choices than when they got out of school. But many have decided to avoid learning from experiences and decide upon a view and encourage all others to take this view. This is usually done with some intent to manipulate or control the idea and is hardly healthy.
Please really take a look around you and really notice all the really good things achieved in your life time. Was it money that achieved this or was it idea creation, decision making and effort into a direction? And who were these folks putting in these ideas, who put in all this effort and made the experience for real? Some times the best answers sit within each and every experience we ever have if we are willing to review the experience itself and not all the symbols distributed that disrupt or pervert our vision.
Freedom from the Income Tax is LIBERTY defined in a Republic way of life. It is the decision to free ourselves from the thieves of 5000 year old ideas. It is the beginning of a new independence from A Rule way of life only created by a few for themselves. It is the incentive for achievements and idea that support and grow who we are in our communities. It is the life we all long for only because we are without it and it is freedom from our own ignorance of their Rule way of life and 5000 years of very bad ideas that have consistently in that 5000 years produced nothing more than its own self destruction each and every time.
LIFE, the decision makers of the WORLD, I dare YOU to decide to live without their old ideas and to create new ones that support you directly in your own community for your Republic simply awaits your own decision.
@WilliamSchooler Thx that was a very Enlightening Comment
Even though I was a big fan of Browne, his statement that the passage of the 16th Amendment authorized an income tax in contrast to excise taxes is incorrect.
Eighteen years before the adoption of the Sixteenth Amendment, a legal controversy arose concerning a federal income tax statute. In 1895, the United States Supreme Court struck down, as unconstitutional, the federal Income Tax Act of 1894. The Court concluded the tax imposed by the Act on “rents or income of real estate” was not significantly distinct from a tax on the property itself. Therefore, the Court classified the tax as a direct tax requiring apportionment among the several States.
Following this ruling, even though the Court did not hold that all income taxes were direct taxes, there was uncertainty as to whether income taxes fell in the class of direct or indirect taxes. As a result, Congress sought to remove all doubt by passing an amendment to the Constitution.
Immediately after the Amendment was ratified in 1913, Congress enacted another income tax. The new law was immediately challenged as unconstitutional. In 1916, the Supreme Court issued two decisions on the scope of the Amendment. The Congressional Research Service in a 1980 Report explained the effect of the Sixteenth Amendment in two sentences:
“The Supreme Court, in a decision written by Chief Justice White, first noted that the Sixteenth Amendment did not authorize any new type of tax, nor did it repeal or revoke the tax clauses of Article I of the Constitution… Direct taxes were, notwithstanding the advent of the Sixteenth Amendment, still subject to the rule of apportionment and indirect taxes were still subject to the rule of uniformity.”
Source for above quote: “Some Constitutional Questions Concerning the Federal Income Tax,” Howard M. Zaritsky, (Congressional Research Service, Washington, D.C., 1980) p. 5, Report No. 84-168 A 734/275.
As stated by CRS, the Amendment did not authorize any new type of tax. It also did not repeal the existing clauses. Indirect taxes were still subject to the rule of uniformity and direct taxes were still required to be apportioned among the several States.
The CRS Report referenced above made the following statement concerning the Supreme Court’s decisions on the nature of the federal income tax:
“Therefore, it can be clearly determined from the decisions of the United States Supreme Court that the income tax is an indirect tax, generally in the nature of an excise tax.”
Source for this quote: page 6 of the 1980 CRS Report.
On March 27, 1943, an analysis of the federal income tax was published in the Congressional Record. This compilation of information was written by a former legislative draftsman in the Treasury Department (one of the people who wrote the tax laws) and entitled: “The Income Tax is an Excise Tax, and Income is Merely the Basis for Determining its Amount.” This commentary stated, in part:
“The income tax is, therefore, not a tax on income as such. It is an excise tax with respect to certain activities and privileges which is measured by the income they produce. The income is not the subject of the tax: it is the basis for determining the amount of the tax.”
Source for this quote: Congressional Record, Volume 89: Part 2, p. 2980.
The so-called federal income tax is an indirect excise tax based on the exercise of an activity or privilege. Income is simply the measuring stick to determine the value of the activity or privilege that is the subject of the tax.
Thus, the question is: what is the activity or privilege that is the subject of this indirect excise tax and why is it disguised and presented as a Sixteenth Amendment tax on income when the Amendment did not authorize any new type of tax?
@Bob Greenslade
Thank you Bob for your wise wisdoms and I mean no disrespect with what I am going to say, but your example is too good to pass up.
Tax is a set of Symbols with an idea attached, this idea is to extract moneys from some who produce it and give it to a group that produces nothing. This idea if you will take the time to look came in the time of ancient Egypt and was for the privileged to live off the producing, to grow their Rule way of Life.
Your writing can make a good argument, but who would you be arguing? Someone who can also organize words and symbols very uniformly on a page? The problem is that it is a display of symbols one against the other for an idea that was for privileged to take from the producing. What this really means is; it is one Life taking from another life with some allowance to live, ( Oh yes Oh Wise lord) May I have this day to breath the air?
My point to this and the constitution is it is only as good as it applies directly to my life. Since I live my life activities take place in a chosen direction of some idea achievement. This action of energy in this direction is by my very own choice to do so and with this energy brings such an achievement and hopefully a good experience to many in my community towards its own support. Now I have already put in haven’t I, I have already put forth this effort in a productive manner so my question is why should some other life decide I need to put far more in while this life puts nothing in at all? So really we could make a thousand pretty words and there would be no real good answer to the life who puts forward all his hard effort to achieve for his community to then turn around and be robbed by a few within that community who wish to put nothing in. The fact is this resinates as the real experience as LIFE and not as organized symbols on a page. Though these can be good to describe a great experience but to pass back and forth with no good experience attached is a waste of effort.
I hope it wasn’t to painful, but what I did was put it through my own experiences and then describing it through this experience. So is it the words that become the argument or the actual experience? I see consistent arguments amongst words and symbols constantly, but when I ask them to show the argument in a personal experience they look at me and go huh?
That is why I really like the original Draft of the Declaration of Independence because Thomas Jefferson wrote it directly to me by experiences. But the constitution was not fully done in this manner because of the argument of scholars with a few who had great experiences. But a scholar could not possibly be disrespected now could they? I mean that is how our Constitution was altered correct?
See I like what you wrote but it does not show me through experience why it should not be at all.
When Tax Day became more important than Thomas Jefferson’s birthday, the nation took a turn for the worse.
I like No Tax Day better =)
“Freedom Day – a day to remember the huge, expensive, intrusive, and meddling government that once was and that we should be on guard against forever.”
I think I’d like it better if they were so intimidated as to remain on guard against us forever…by leaving the country.
Damn hippies!
Want that? Get rid of centralized banking.
FairTax!
paying taxes is a necessity for a country, but not like we have now. we are paying way too much out and not seeing any real benefit of it. the rich get richer, and the poor get poorer. was that the definition of the hope and change that was promised in the last election?
I have lost faith in this country. More people vote for and try out for american idol than they do for public office
I love that idea!! Tax Freedom Day!! What a day that will be. Actually, we pay our taxes now well into May. If we don’t turn this country around, we may soon be paying taxes through June. Can you imagine working for half a year for the government? I can’t!! Vote very carefully in November and PLEASE vote!!
I so agree… the Government needs to STAY out of our personal lives and decisions. We are adults and should not be treated like cattle or children. Less is better – more to the states at a minimum!!
SchoolandUniversity.com help me find a School,University and College.http://www.schoolanduniversity.com
Find out the real truth about the ‘Federal Income Tax’ and who it applies to….
http://www.losthorizons.com
Find out the real truth about the ‘Federal Income Tax’ and who it applies to….
http://www.losthorizons.com
Our taxes don’t go to HELP the country. It goes to pay for the FED money that has been made/created out of thin air. The Gov. goes to the FED and says ” We need money for this and we need money for that. Would you print money for us?” then they say,” don’t worry, the taxpayer will pay for it all.” 9 times out of 10, the money is to keep entitlements going, or bailouts, or endless wars. etc
Our taxes don’t go to HELP the country. It goes to pay for the FED money that has been made/created out of thin air. The Gov. goes to the FED and says ” We need money for this and we need money for that. Would you print money for us?” then they say,” don’t worry, the taxpayer will pay for it all.” 9 times out of 10, the money is to keep entitlements going, or bailouts, or endless wars. etc
“Many people aren’t aware that America – conceived in liberty in 1776 – didn’t have a permanent income tax until 1913. In fact, the Constitution of the United States prohibited an income tax.”
The Constitution has never prohibited an income tax. The nation’s first was enacted in 1861, and its constitutionality was upheld by the Supreme Court in 1881.
The authority to impose an income tax comes from Article I, Section 8, Clause 1 of the Constitution, not the 16th Amendment; the sole purpose of the amendment was to overrule the Supreme Court’s 1895 Pollock decision, in which it held that a tax on investment income was a direct tax on the underlying property and therefore had to be apportioned. Congress has always had the power to impose an income tax, and the amendment simply did away with the apportionment requirement with respect to certain types of income.
The oft-quoted “The income tax is, therefore, not a tax on income as such. It is an excise tax with respect to certain activities and privileges which is measured by the income they produce. The income is not the subject of the tax: it is the basis for determining the amount of the tax.” isn’t quite accurate. The income tax is an excise on the receipt of income, regardless of the activity that generates the income. While there are statutory exemptions for some types of income, the tax doesn’t simply reach “certain” activities or privileges — it reaches all nonexempted income.
@cptbanjo
On April 26, 1913, Cordell (Judge) Hull, a Representative from Tennessee, explained the “new” income tax law adopted by Congress following the adoption of the Sixteenth Amendment:
“In any event, the proposed tax is measured by net profits or gains, and is not imposed upon gross income nor capital nor other property. If a citizen has not been successful in his efforts to accumulate profits he is not required to pay the tax, but if he has prospered he is required to contribute to his Government, not the scriptural tithe, but a small percentage of his net profits.”
Mr. Hull went on to state:
“The proposed law should be construed as similar laws have been construed by the courts with respect to the application of the tax [Corporation Excise Tax Act of 1909], and that is that the income in question shall be the measure of the tax and not the specific fund out of which the tax is necessarily payable; the bill takes as the measure of the tax the net income of the proceeding year. Paragraph B defines the net income of a taxable individual or person. Income as thus defined does not embrace capital or principle, but only such gains or profits as may be realized from rent, interest, salaries, trade, commerce, or sales of any kind of property, and so forth, or profits or gains derived from any other source.”
Source for Hull’s quotes: Congressional Record, Volume 50: Part 1, pp., 505-506.
@Bob Greenslade
The biggest difference between the 1913 tax on individuals and today’s tax is the size of the personal exemption. In 1913 it was $3,000 for an individual and $4,000 for a married couple. That’s $65,000-$80,000 in today’s dollars. By failing to maintain this level of personal exemption, Congress has over the years increased the income tax hit tremendously. But they have the constitutional authority to do so.