May 1, 2012

The morality of taxation

Filed under: Britain, Economics, Government — Tags: , , — Nicholas @ 08:17

In the Telegraph, Philip Johnston recounts the story of the 10 beer-drinking men and uses it to discuss the morality of taxes. Although the details are British, the story applies equally to Canada or the United States:

No discussion of the morality of taxation can be divorced from what is done with the money. It is not enough to say we must all contribute according to our means without at the same time questioning where it all goes. Tax has become the new immigration: a taboo subject for politicians who fear being derided as friends of the rich or denounced for immoral policies.

Yet, even with the parlous state of the nation’s finances, an argument can be made for low taxation that speaks to both a desire for smaller government and for greater personal freedom. The last Labour government took too much in taxes not merely because it believed that ever-increasing amounts of public spending were the only way to achieve better services. It did so because socialists think they know best how to spend people’s money and should be entrusted to do so. That is the essence of the Left’s worldview; and it is the principal reason why the state has grown so much in the past 50 years.

Where is the morality in taking money from people so that politicians can feel good about themselves? How is it ethical of a government to remove 40 per cent of an individual’s income with the purpose of engineering society the way it sees fit, rather than ensuring that people have the means to get on, by and large, with their own lives? Our system of governance has become characterised by grotesque waste, unfulfilled promises, incompetent delivery and excessive red tape. It has over-reached itself and seems incapable of retrenching, even under a Tory prime minister.

The moral, and Conservative, case for lower taxes is that they allow people to make their own decisions, to save when they wish, to give if they choose and to spend on what matters to them. Tory politicians should not be ashamed to talk about cutting taxes, because high taxation removes the need for individuals to take responsibility for their own lives and heightens cynicism about the ability of the government to deliver.

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