How Much Tax Should Citizens Pay?

How much tax should citizens have to pay? Tax is raised to protect, safeguard and provide citizens with essential services. If you are luck or unlucky enough (depending on your view point) to be in work then you will work a certain proportion of your time to pat tax. This is nothing new; in times that have gone peasants used to have to work the fields of their protector for so many days, in return for the protection. Some were forced to pay tithes – one tenth of what they earned – to the government or church that afforded them protection.

Most people would think that to work nine days for yourself and one day for your protection would be a reasonable bargain. Protection means government, and protection means not only providing services direct protection, like the police and armed forces, but additional protection like health and educational services, and indirect protection that society provides when it provides a safety net for those who cannot work and directly contribute to the common weal.

Since medieval times when tithes were levied things have progressed. Today, according to the Adam Smith Institute we work 150 days out of 365 (or around three days out of seven) to pay our tax. If I work harder I pay more tax, if I work less hard I contribute less in taxation.

Of course there are some who make an art form of taking from taxpayers, when they should be contributing to the common weal and thus enabling all taxpayers to keep a little more of their hard earned wages. I do not know how many there are, but that figure is probably impossible to calculate because the complexity of government regulations which provide for the safety net.

Governments raise tax because they decide that they should spend money. They do not seem to start with the question “how much tax is fair to levy?” but with the question “what services and facilities should we provide for the citizens?” Starting from the wrong question means that inevitably government budgets are larger than they should be and money is wasted by governments. When governments waste money they waste the time spent in earning that money by their citizens.

Governments, by virtue of the democratic process will inevitably spend tax in favouring their supporters and encouraging those that do not support them to support them in future. Mr Tony Blair’s government made an art form of this, increasing the people employed by quangos and government and increasing their pay so that he had a large number of citizens who had a vested interest in his re-election.

Ultimately, of course, these tactics are not affordable. Eventually the strain on the economy takes its toll, which frequently leads to citizens having to work harder to pay higher debt incurred by government.

You will see that I have so far avoided answering the question of how much tax should citizens have to pay? I think that since medieval times there have been more things that governments have to do to protect their citizens, but the protection must relate to what is fair and what is affordable. It is probably fair that no one should have to spend more than 20% of his or her time working in order to pay tax. That would reduce the days we work each year from 150 to 73 days.

The political process would then decide how the money would be spent, as opposed to deciding how much money should be raised. At least then the starting point would be fair and the proespects of the outcome being fair would be better.

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