Taxation is money coercively extracted from the populace by an agent, typically the state. It is a form of binary intervention, creating a hegemonic relationship between the state and the citizen.
Taxpayers and tax consumers
Funds from taxation must be taken from economic actors and then provided to other economic actors. An actor can fall into one of two categories: taxpayers and tax consumers.
- A taxpayer is a person who pays more tax than he or she receives.
- A tax consumer is a person who receives more funds from taxation than he or she pays.
Taxpayers and tax consumers necessarily have conflicting interests, as tax consumers benefit from the funds expropriated from taxpayers. Taxpayers may only benefit indirectly from the services that the tax consumers provide, often called "public services". This contrasts with the producer-consumer relationship, wherein two economic actors will exchange if and only if the exchange is mutually beneficial. Because taxpayers cannot choose to decline paying tax, there is no guarantee that tax consumers will confer adequate, or even any, benefit to taxpayers.
- ↑ 1.0 1.1 Murray N. Rothbard. "4. Binary Intervention: Taxation", Power and Market, online version, referenced 2010-12-13.
- ↑ John C. Calhoun. "A Disquisition on Government", referenced 2010-12-14.
- Tax at Wikipedia
- Taxation by Joseph J. Minarik at The Concise Encyclopedia of Economics
- Soak-the-Rich Taxes: Fail! by Robert P. Murphy, November 2010
- Nineteen Neglected Consequences of Income Redistribution by Robert Higgs, December 1994