Death of a Taxman

Published in Cebu Gold Star Daily




Taxation is perhaps the most boring subject matter I can think of to write about (and the most detested subject for those who ever took the bar exams). But taxation remains, or at least it ought to be, the most effective tool for social justice. 


Long before agrarian reform, welfare and socialized housing, there was taxation. Taxes are nothing more than enforced contributions to society, where people give a certain percentage of their earnings to fund State services. It is clearly designed as form of socialism or equalizing device to shrink the gap between the rich and the poor. 


Here are the basic premises for taxation: 

1. People gain wealth by using State services and systems (e.g. land, business grants, government contracts, etc…). 
2. The more wealth you gain from this system, the more you have to contribute to keep that system running.
3. If you are poor, you need help, so you are exempted from giving your contribution to the State until you can rise to a level where you can support yourself and those who depend on you.

From this, we formed a system where the fortunate support the unfortunate to a certain extent so that the latter are given enough breathing space to improve their lot in life. Progressive taxation means that those who have more must give more, while those who have less are given assistance. 


In its proper sense, taxation ought to be taken from income – money that is gained. This ensures that taxes do not cut deep into the resources needed by people to survive. This ideal has been mangled because the rich find ways to avoid paying their rightful contributions to society. Those who ought to be supporting society are the hiding behind tax shelters and offshore dummy corporations. They avoid their social responsibility and make all these fancy legal excuses to justify greed.


So how does the government respond? By creating non-progressive fixed taxes, like the misleadingly named value-added taxes, that burden everyone equally, rich or poor. This painfully upsets the balance. After all, equal treatment of unequal people is inequality. The purpose of taxation is mangled, and people don’t know why they are suddenly paying 12% more for something that they’ve been consuming for a very long time.


On the other hand, people are quite justified in refusing to hand out their hard-earned money without seeing concrete results. Massive corruption and incompetence of government have left us a cynical people. Angry. Restless. Our taxes do not seem to be making more schools. They do not seem to stop the violence in our streets. They do not give us clean air or water. They do not seal the cracks on our roads or provide enough supplies to our hospitals. They do not seem to provide health, safety, justice, education, convenience or even access to state services.


The nasty people from both the business sector and government have turned us into this nation of whining idiots, always complaining about things we think we cannot control. They have transformed us into people who would rather ignore the difficult reality than actively steer it towards a better place. The greed of the few has virtually doomed us all… all because of money… all because our best defense against greed and inequality also involves money.


In spite of all this, I believe that a tight, disciplined and brutal taxation system managed by people with the same qualities is one of the keys to moving forward. Obliterate all the fixed taxes and optimize progressive income tax collection. This is the surest way to swell our middle class and give a fighting chance to our poor. 


The wealthy support the poor. 


That is the design. 


That is the way it should be.