I have continued to read the comments on Jeff Haymond’s blog about progressive taxation, and my own complementary blog, and have decided I should make another foray into this subject to address in more depth the ethical theory of policies such as taxes (but, indirectly, others as well). The question to begin is: Is progressive taxation unbiblical and therefore unethical? On that, I do have to admit from a strictly exegetical standpoint, no tax is either moral or immoral per se. The Bible is silent on the ethical status of taxes. Of course the motives for imposing the tax may be bad, or the people imposing it may be tyrannical, but by itself a tax is biblically neutral.
That brings taxation generally back into the realm of prudence and efficiency. Now that fact does not mean that taxes have no significance at all for human welfare, that they don’t make any difference in looking at their consequences. Nor does it mean that because the imposition of taxes is not a strictly biblical issue, that the burden of taxation is not an ethical issue—if one accepts that it is acceptable to tax Group A to redistribute to Group B, then why is it not unacceptable to take from that Group A in the first place? In other words, if someone says to me, “I believe since taxes are an indifferent issue biblically, so let’s tax the rich more,” why can’t I respond, “Well then why is it acceptable to tax only the rich more and not everyone proportionally equally?” or “Why do we take from the rich—is it just because they are rich?” Why is it ethical to take from the rich at all, regardless of who benefits? One has a pretty tough ethical case to make. We are reduced now to arguing why one is better than the other.
So why would one be better than the other? The answer lies in considerations of what kind of behavior each taxation approach incentivizes and disincentivizes and what kind of relative position each taxed individual and each individual receiving benefits from taxation is in after the tax scheme is implemented. The first has to do with efficiency, which Jeff Haymond addressed. The second is different. It actually touches on issues of fairness.
Now I am the first to agree that the concept of fairness is notoriously difficult and sometimes vague. Fairness is a distributional concept—who gets how much—but more than that, it attempts to evaluate the outcome of the distribution from some sort of normative perspective. But doesn’t that bring it back into the realm of ethics and therefore doesn’t it bring taxation back into ethical consideration? It depends on how one characterizes fairness. In fact, fairness also includes the question of how to “distribute” the negative aspects (the costs) of a policy, such as a tax burden. Is it fair to tax one group, and not another? Under what conditions, if any? Does Scripture have anything relevant to say on this? Does broader ethical theory have anything to say, and if so, what is the relationship of that particular type of ethical theory to “Divine Command Theory” (arising from special revelation)?
Fairness is sometimes defined as equivalent to justice (John Rawls, Justice as Fairness) or justice as a distributive quality. Other times, the two concepts are seen as distinct. One scholar tries to distinguish them this way:
“If justice demands that a citizen’s position in society is due to ‘relevant reasons’, then fairness is about a citizen’s position being determined by factors within her control, as opposed to influenced by luck. This is the principal difference between the concepts of justice and fairness.” (C. Cooke, “What is the Difference between Justice and Fairness?” nd, at http://www.oriel.ox.ac.uk/sites/default/files/Cooke,%20C%20Essay.pdf)
So justice demands that decisions be for relevant reasons, while fairness demands that the outcomes of decisions be determined by factors within a person’s control. If you have no control over what “happened” to you, what you received, etc., then we may label the outcome “fair.” It was a product of chance, it is argued. It stands to reason, if one accepts this definition, that the closer one comes to judging people based on factors they could not control, the more likely one would favor greater equality of outcome with reference to that factor. For example, one cannot control his particular birth parents or environment, so it would be unfair to allow that person to suffer in relation to others when it can be prevented by policies that would equalize or move toward equalization of the results of his deficiency. In other words, fairness would dictate helping that person to raise him up toward a situation closer to his fellow humans.
That however doesn’t answer all the questions raised in relation to taxes, even if I agreed with this one. We also collect taxes to provide public goods and services. I suppose one could say it was fair to tax poorer users of those services more if they could not control their poorer status. But being able to determine that is a nearly impossible task. Relative poverty is due to many different factors. In addition, another principle of fairness might require that those who benefit pay, much like purchasing a private good. In fact, one might posit many different criteria of fairness, for example, keep all you earn, make people over certain incomes pay more, take everything from everyone and redistribute it in equal portions, etc. So though I might be able to see the usefulness of the first definition, I still cannot see on what ethical foundation it rests—for that matter any of the criteria of fairness that might be suggested suffer the same fate. And if one wants to accept the first definition, one still must determine what factors are or are not considered within a person’s control.
With this said, is it possible to say that since we cannot agree on an appropriate criteria by which to distribute a tax burden, perhaps we ought not to try to derive any other burden other than one that does not take into account the factors of control or non-control, but just tax either using the same rate for all, the same actual tax for all, or rates dependent on benefits received? That sounds pretty radical I know. But unless I am mistaken, only those approaches avoid the problem of classifying who has control and who does not in given situations.
That still does not address the explicitly ethical issue, though the fairness definitions are taken as normative, not merely descriptive. More is needed. Can any or all of the three criteria I suggested for taxation be considered consistent with (if not explicitly commanded by) special revelation—or forbidden by special revelation? I am still committed to grounding my ethical views on principles derived from special revelation.
So, without answering that question, I will end this blog here and be back with another as I continue to reflect on this interesting and important issue of taxation.