Most European countries derive significant revenue from value added tax (VAT). It is a form of national sales tax levied by the government at each stage of the production and distribution of a good. Manufacturers and businesses add the cost of the tax to the price the consumer ultimately pays. Some European countries have a VAT rate of almost 40%. To offset the federal revenues currently collected through the progressive income tax, the United States would have to have a value-added tax rate of at least 25%. This would result in much higher consumer prices, although some products, such as staple foods, could be exempted or taxed at lower rates. While collecting VAT from manufacturers and businesses would likely add bureaucracy to the IRS, individuals would not have to file annual tax returns or pay income tax. The solution to the failure of collective action under the articles lay in the creation of a more powerful and comprehensive governmental entity – a national government with the power to tax, establish and sustain an army, regulate interstate and international trade, and act directly on individuals. The tax clause in Article I, Section 8, is listed first for a reason: the authors decided, and the ratifications of the Constitution agreed, that Congress itself must have the power to “collect and collect taxes.
to pay debts and to ensure the common defense and general welfare of the United States.” Congress was given the power to assess, collect, and collect taxes without the need for state assistance, and Congress` fiscal power was not limited to paying off Revolutionary War debt—it was also prospective. The first day of collection of taxes under the new law was March 1, 1914. Since the average worker earned only about $800 a year, few people had to pay federal income tax. Less than 4% of American families earned an annual income of $3,000 or more. Deductions and exemptions have further reduced the pool of taxpayers. Yet the federal government raised $71 million in its first year. Millionaire John D. Rockefeller alone paid about $2 million. The Law: The First Amendment to the U.S. Constitution provides that “Congress shall not enact any law respecting or prohibiting the free exercise of religion; or restrictions on freedom of expression or freedom of the press; or the right of the people to assemble peacefully and to ask the government to remedy the situation. However, the First Amendment does not provide for the right to refuse to pay income taxes on religious or moral grounds, or because the taxes are used to fund government programs that are rejected by taxpayers. Similarly, it is generally accepted that the RFRA does not have the right to avoid paying taxes on religious grounds.
The First Amendment does not protect commercial speech or speech that aids or abets taxpayers to unlawfully refuse to pay federal income taxes, including statements that encourage abusive tax evasion schemes. Relevant case law: United States v. Lee, 455 U.S. 252, 260 (1982) – The Supreme Court has held that the general public interest in maintaining a sound tax system is of such importance that religious beliefs that contradict the payment of taxes are not grounds for refusing payment. Jenkins v. Commissioner, 483 F.3d 90 (2d cir. 2007) – der 2. The judicial district upheld the imposition of a frivolous penalty of $5,000 on taxpayers and ruled that increasing tax revenue for expenses that violated the religious beliefs of individual taxpayers did not violate the First Amendment clause, the Restoration of Religious Freedom Act of 1993, or the Ninth Amendment. United States v.
Indianapolis Baptist Temple, 224 F.3d 627 (7th Cir. 2000) – The 7th District dismissed the defendant`s claim against the free exercise of federal labor tax because these laws were not limited to the defendant or other employers related to religion generally, and there was no indication that they were enacted for the purpose of interfering with religious practices. Adams v. Kommissar, 170 F.3d 173 (3d Cir. 1999) – der 3. The county upheld tax deficiencies and penalties for failing to file tax returns and pay taxes, and ruled that the Restoration of Religious Freedom Act did not require that federal income taxes reflect Adams` religious beliefs, that paying taxes to fund the military was contrary to God`s will, and that their beliefs were not a reasonable reason for the End of punishment. United States v. Ramsey, 992 F.2d 831 (8th Cir. 1993) – On the ground that Ramsey “has no right to avoid federal income taxes on religious grounds,” the 8th District rejected his argument that filing federal income tax returns and paying federal income taxes violated his pacifist religious beliefs. Wall v.
United States, 756 F.2d 52 (8th Cir. 1985) – Der 8. The judicial district upheld the imposition of a frivolous $500 penalty on Wall for making a “war tax deduction” on his tax return because of his religious beliefs, stating that “the necessities of tax collection through a sound tax system increase the interests of government that are sufficiently persuasive to outweigh the rights to freely exercise taxes on a bona fide basis. religious reasons to be offensive.” United States v. Peister, 631 F.2d. 658 (10th Cir. 1980) – The 10th District found that Peister`s right to religious freedom had not been violated and rejected his argument that he was exempt from income tax because of his vow of poverty after becoming pastor of a church he founded. Salzer v. Commissioner, T.C. Memo. 2014-188, 108 T.C.M. (CCH) 284 (15.
September 2014) – The court found Salzer`s justification for non-payment of taxes to oppose the government`s “socialist” policies frivolous and concluded that “the legal obligation to file a tax return exists regardless of a taxpayer`s personal political, economic, social or religious beliefs.” Other cases: Droz v.