The following is an introduction to tax revolt and includes some how-to information. In publishing it, REASON is not advocating that any of these tactics be pursued by specific individuals; nor is REASON proffering legal advice. For an analysis of the legal problems of tax resistance, see the related article in this issue by David Bergland. For a picture of the awesome power of the IRS, see the article by Robert Martin.

Even more revolting than that suit.Resentment of the inequitable nature of the U.S. tax system, and of the progressive income tax in particular, is increasing among every segment of the taxpaying population. In fact, it is rare these days to hear anyone say that he's happy to pay taxes. The hard evidence of this anti-tax-slave attitude was statistically expressed in late 1973 when a Harris Poll discovered that 74 percent of U.S. taxpayers "would support a tax revolt." If the accuracy of this poll were verified by other similar samplings, then certainly the tax-collecting bodies of this land ought to be living in fear of the day that Americans decide it's time for a repeat performance of the Boston Tea Party.

But what is the cause of this hostility? Why all this resentment of what the IRS describes as "the most efficient tax system in the world"? Perhaps it is the growing realization of a literate, productive citizenry that it is "paying the 'fiddler" to the tune of 42 percent of its average annual income in direct and indirect taxes. Add to this the inflation bite of 10 to I5 percent per year and the virtual certainty that tax increases are looming on the horizon, and there is a credible explanation for the whole phenomenon. Doubtless, Americans are tired of working over half their productive lives in order to pay for their semibenevolent welfare state. In short, the tax system is too efficient.

To compound the serious nature of the problem- serious from governments' point of view-it seems that Americans are not the only residents of the earth adopting the attitude that there is "too much taxation and ' too much representation." Overburdened taxpayers the world over are beginning to act. In Denmark, for example, a place of cradle-to-grave welfare statism, it is reported that 16 percent of the taxpaying citizenry is following tax-reform leader Wlogens Glistrup in refusing to pay income taxes, Clearly, at least 16 percent of the Danes feel that the price paid for their government security blanket is out of proportion to the real benefits.

ESCALATING RESISTANCE

The September 17, 1973, issue of US, News & World Report states that: 

A tax-dodging spree, spreading rapidly, is costing the Government in Washington at least 6 billion dollars a year and threatening to get completely out of control. Tax experts outside the IRS... put the real losses as high as five times that much, around 30 billion a year. 

This was shocking news in 1973, but today one simply has to purchase the latest edition of Tax Strike News, a monthly tabloid in the forefront of the tax battle, to discover that hundreds of organizations have been formed nationwide to help disseminate the "new religion" of the tax strikers, The size and scope of the movement to abolish taxes has grown to such an extent that virtually every Western State now has a "citizens posse" organized to apprehend and try tax collectors who abrogate the constitutional principle of due process.

 Some adherents of lawful tax resistance identify themselves as followers of the early colonial tax protesters like Thomas Paine and Sam Adams, and there is a large and newly emerging segment in the movement which calls novelist/philosopher Ayn Rand its intellectual mentor. But in common they have been heard to tell IRS agents: "Go straight to hell, do not pass go, and do not collect $200." 

There is little doubt that the movement is growing, and its leaders believe that the 16th amendment to the U.S. Constitution, which authorizes the income tax, will soon fall, as did the 18th amendment enacting Prohibition. It is historical fact that the 18th amendment was repealed because millions of Americans refused to comply and the enforcement machinery could not deal with this. We may even find that the same individualistic Americans who started drinking bootleg booze in order to thwart the revenuers will stop paying income taxes for the same reason.

HOW TO STOP PAYING

 Active resistance is made possible chiefly through loopholes, and the prospects of any serious action to close them are pretty slim: lobbies and loopholes are in the self-interest of entrepreneurial Congressmen, who are quick to take advantage of the status quo of taxation. And don't mistake cosmetic tax reform for substantive change. It is simply not in the self-interest of most legislators to drastically curtail their own tax advantages, so it is likely that the game will be played in the future much as it is now.

"Well," you ask "which loophole should I use?"

 The favorite one, reportedly used by some 3% million Americans at the present time, is the religious exemption whereby any religious leader, self-ordained or otherwise, may exempt himself and his household from Federal and State income taxes, property taxes, and sales taxes. Certificates of ordination can be purchased within the $1 to $10 range, and the first amendment and the courts have already told the IRS to keep its hands off. This approach also makes it possible to exempt oneself from social security using IRS Form 4029. The popularity of this loophole is growing by about 2,000 ministers per day-a great shot-in-the-arm for organized religion.

 A lesser known but equally effective loophole, the "Equity Pure Trust," is available to the taxpayer who is willing to keep detailed records. It seems that this unique type of trust exempts one's estate from the ravages of inheritance, estate, and gift taxes and partially exempts it from the other big four taxes: income, social security, property, and sales. It is quite complicated, however, and its most loyal subscribers are those termed "the rich and the superrich." 

Fortunately, there are two angles for the unreligious, the garden variety constitutionalist, and just plain protesters: the fifth amendment approach against self-incrimination and the lack of gold and silver income necessary to require the filing of a return.

INVOKING THE CONSTITUTION 

The fifth amendment approach is quite straight-forward: the ex-taxpayer merely places the fifth amendment objection to self-incrimihation in each blank space in the 1040 return where his answer to the question may tend to incriminate him. The U.S. Supreme Court and the appeals courts, in the Sullivan, Bishop, Miranda, Murdock, and other landmark cases, have upheld this approach, providing it is invoked properly. From that point on, Big Brother is responsible for proving a tax liability and initiating civil or criminal action. But a shrewd practitioner of tax avoidance will have covered his trail nicely. 

And what does gold and silver have to do with resistance? The Founding Fathers, in their infinite wisdom, wanted only gold and silver coin to circulate as legal tender, and all legislative activity to the contrary notwithstanding, the constitutionality of this approach has not been overturned. Therefore, anyone who has not made the requisite $750 income in gold and silver during a taxable year is not required to file a return. Since U.S. Federal Reserve Notes have not been redeemable in gold or silver since March 18, 1968, no one has gotten "income"-no real income, no taxable income.

Just to cinch things up a little tighter in favor of the overburdened taxpayer, it is necessary that the taxing agencies go to the courts for enforcement of the writs they use for inspecting and seizing records and assets. It is therefore difficult for them to prove a tax liability when they are refused the information needed to make an assessment. Some courts have already ruled that the mechanical tax tables cannot be used to prove a specific tax liability because citizens have the right to itemize their deductions. It is very hard for the IRS to prove whether or not money has been spent on deductible or nondeductible items.

 In case anyone's worried about how to stop withholding of taxes from his paycheck, it's as simple as filing a W-4E Form each year or working for an employer on contract. And in case there are worries about what to do on April 15 each year, the tax protesters say it's as simple as saying "no" to the government-operated extortion racket; refuse to be coerced or intimidated. The legal way to do it, of course, is to refuse to waive any of one's constitutional protections; just take the fifth and demand that due process be observed. Also, it may help to tell the taxmen about being "innocent until proven guilty." The taxmen must be assured, however, that payment will be made in full when it's been proven by a jury that a specific tax is owed; that obviates criminal intent.

None of the above loopholes and constitutional advantages would be necessary if the tax system were as voluntary as the IRS claims it is. Try not volunteering without knowledge of the individual's rights and privileges, however, and see what happens. Also, if the IRS really cared about protecting the rights of taxpayers, wouldn't it make sense for it to put the famous Miranda Warning on the 1040 Form? After all, every suspected criminal is told that he doesn't have to incriminate himself. Of course, the IRS is not foolish enough to warn citizeris that the information put on the 1040 and other government forms may be used against them-people might get the idea that they have a choice in the matter.

THE ANTITAX POLITICAL PARTY 

To aid in the abolition of our revolting tax system, there is a new political party on the scene, the Libertarian Party. Libertarians identify taxation as theft and hold that it therefore ought to be outlawed. Their platform calls for legal challenges to the tax system, and their ranks are growing, in part, as a result of this stand.

The libertarians' view of taxation stems from their conclusion that the individual is the primary agent of economic transactions and ought to be free to spend what he earns as he prefers. Having thus precluded forced financing of government activities, they advocate a totally voluntary society in which the proper function of government would be only the protection of the life, liberty, and property of each from fraud and coercion, Each person would be free to purchase as much protection as he or she believes needed, Government services would have to compete in the marketplace for the consumer dollar, and government activity would occupy only that share of the market which reflected the choices of the consumers. And that would be the end of compulsory government financing.

HOW TO GET THERE FROM HERE 

The current US. political system delegates unlimited taxing powers to the legislatures. This, coupled with the desire of the majority of the voting population to enrich itself from the public treasury, has nearly brought on national bankruptcy. The public monies are being spent faster than they are being collected, and the end of that downward spiral means disaster. 

Will the recipients of public monies stop voting for the politicians who give them the goodies? It is not likely. So, it seems that a situation of "irreconcilable differences" is. developing between tax producers and tax consumers, a truly revolting situation. And if this is true, as mounting evidence suggests, then perhaps the natural tendency to revolt is the cure.

Revolts have traditionally trimmed the irritating factors from the political system and allowed the body politic a system permitting greater personal and economic liberty. At least this was true of the American Revolution. We may be fortunate enough to repeat our own history and come up with an improved political ideology that will remedy the defects of our currently failing society.

Perhaps the tax protesters are standard bearers of ideas that will end the something-for-nothing syndrome in the United States. If successful, they will be ultimately responsible for putting thousands of tax collectors to work in the private sector doing a full and honest day's work.