An American Tax Strike?

KaneKungFu123 · #1 01-14-2006, 07:42 PM

What would happen if a huge percentage of Americans decided that they would only pay 75% of their taxes, giving themselves a 25% tax cut and telling the government to start cutting their spending and stop [censored] up?

Would the government have to go and arrest 1/4 of its population, and if these people are in prison, who will earn income to pay more taxes next year?

The Don · #2 01-14-2006, 07:54 PM

There are a few things that could happen:

1) It could create new money to pay for existing programs, causing inflation (and the price distortions and redistribution of wealth that goes along with it).

2) It could borrow more money with treasury bills and such, creating more debt (although this would be passed on to future taxpayers or funded with inflated currency).

3) It could increase the tax burden on everyone else. People probably wouldn't stand for this, so this is unlikely.

4) It could realize that people were fed up with the multitude pointless spending operations and actually start cutting some. This is highly unlikely though, as people in government are self-interested and short-term oriented -- making government smaller is inconsistent with this.

5) It could go into full totalitarian mode and imprison 1/4 of the population. I really doubt this would happen.

A combination of the first two is far more likely than the latter three in my opinion. Although #4 might be combined with #1 and #2.

Borodog · #3 01-14-2006, 07:54 PM

The trick is that Congress has illegally drafted the nation's employers into acting as IRS agents. Most of the income taxbase is compulsorilly collected by businesses. Businessmen have to comply with this because the risk of non-compliance is huge, not just their own personal ruin, but the loss of their company. The rational choice is compliance, as is usually the case when there is a gun pointed at the back of your head.

KaneKungFu123 · #4 01-14-2006, 08:02 PM

[ QUOTE ]
The trick is that Congress has illegally drafted the nation's employers into acting as IRS agents. Most of the income taxbase is compulsorilly collected by businesses. Businessmen have to comply with this because the risk of non-compliance is huge, not just their own personal ruin, but the loss of their company. The rational choice is compliance, as is usually the case when there is a gun pointed at the back of your head.

[/ QUOTE ]

The government is always a step ahead, I guess that is why they are the rulers.

The Don · #5 01-14-2006, 08:02 PM

[ QUOTE ]
The trick is that Congress has illegally drafted the nation's employers into acting as IRS agents. Most of the income taxbase is compulsorilly collected by businesses. Businessmen have to comply with this because the risk of non-compliance is huge, not just their own personal ruin, but the loss of their company. The rational choice is compliance, as is usually the case when there is a gun pointed at the back of your head.

[/ QUOTE ]

Since KKF is a pro gambler he probably wasn't aware of this. I will just add a quick example to make things more clear.

If you get a job at Burger King, you will notice that taxes are automatically deducted from your pay -- it is like this with most jobs. This was enacted by government in the 1930s(?) largely to prevent mass tax evasion. This way, the IRS can just keep track of businesses, and not every individual in the population. Of course, business owners suffer because they are forced into a situation of where they are essentially slaves of the government -- forced to collect its taxes without compensation.

Borodog · #6 01-14-2006, 08:36 PM

I thought that withholding was one of those "temporary emergency measures" from World War Two? I need to look it up.

QuadsOverQuads · #7 01-15-2006, 12:30 AM

What would really happen?

Bush would prosecute the middle class, cut services for the poor, and then use the "savings" to cut taxes for billionaires.

Same as always.

Meanwhile, the Republican goose-steppers would praise him for his great and noble wisdom, and would blame Democrats for their declining standard of living.

Again, same as always.

q/q

SheetWise · #8 01-15-2006, 12:39 AM

Define huge. I think about 15% have given themselves a 100% tax cut -- and it's been steady over the years. Tax compliance is an issue the government is well aware of. The flat tax is not really a controversial issue as much as it's a compliance measure waiting for the right time.

Riddick · #9 01-15-2006, 01:12 AM

I don't think you can be arrested for choosing not to pay your taxes, so long as you report them honestly. Its an American thing.

Borodog · #10 01-15-2006, 01:29 PM

A good friend of my brother took up with a crazy woman that lived on a compound in the southwest (I believe it was Arizona; wherever Intel is located out there, that's where he worked). No one on the compound didn't pay taxes. They told him they'd never had a problem. You just right a letter to the IRS saying you didn't believe in income taxes and you weren't paying them anymore, and that's that. He did it and didn't hear a peep from the IRS about it.

He broke up with the woman after 2 years and eventually became nervous about the whole tax issue, and decided he'd better file a tax return. He got a letter from the IRS informing that since he apparently does believe in paying taxes he owed over $70,000 in back taxes, penalties, and interest. He had to declare bankruptcy. It was a fairly bad scene.

As much as I believe that taxation is theft, or that these "you don't have to pay income tax" guys are correct, the rational choice is still to cough it up. It is too easy for a bureaucrat in an office to destroy your life. Anyone who tries to tell me that taxes are not taken coercively is full of it. I am coerced by threat of financial ruin.