In my previous post, I suggested progressive taxation was not Biblical, and challenged readers to convince me I was wrong.  In the voluminous follow up comments, I didn’t see any Biblical arguments for progressive taxation.  However several posters suggested that there was not Biblical support for any method of taxation (regressive, proportional or progressive).  In this post I will argue instead that a proportional tax system (flat tax) aligns with Biblical principles.  Necessarily a blog post is going to be an abbreviated argument; I will provide an extended argument only in examining one scriptural argument but can address other arguments in response to your comments.  Note that this is strictly looking at the Biblical morality; as an economist I can give you many other reasons why a flat tax is the best system—but I won’t address those here.

First, let’s just agree to a few things.  1) No one argues that a regressive tax (where the poor pay a higher percentage of their income in tax than the rich) is a Biblically justified tax system.  2) No one took up the challenge that a progressive tax system is Biblically preferred (albeit several comments took up the challenge from a secular perspective).  3) Everyone agrees that taxation is necessary to fund government (at some level) and is Biblically justified (Matt 22:21, Romans 13:1-7).  4) Finally, I will agree that there is no explicit Biblical support for proportional taxation.  However, I argue that God’s word contains principles that provide implicit Biblical support.

As always when looking at Scripture, we want to understand how a particular section relates to the grand narrative of God’s plan in redemptive history.  We know that each book was written to a particular group at a particular time with its own unique context, so we first must understand what it would have meant to the original reader/listener.  But then we always ask the question:  what does it mean to us?  Are there principles that apply to today?  The principle of impartiality in social relations—especially in government relationships—seems to be an abiding principle.

In a proportional (or flat) tax system, every dollar of income earned that is taxable* is taxed at the same rate.   Thus every individual is treated identically by the tax code.  There is strong Biblical support for treating people impartially, and in an opposite way, strong condemnation for showing partiality or favoritism.  This is because we are supposed to image God, and God is impartial.  Romans 2:11 states clearly that God shows no partiality with respect to salvation, (see also Deut. 10:17, Acts 10:34, Job 34:19, and Eph. 6:9).  I agree that this is not conclusive, since it isn’t directly talking about taxation, but it does give us an idea of where God’s heart is for how we treat one another.  There is a reason why Lady Justice is blindfolded.

However, there are other passages which take us closer to the heart of the matter.  Lev 19:15 says “‘You shall do no injustice in judgment; you shall not be partial to the poor nor defer to the great, but you are to judge your neighbor fairly.”  In this verse, we are told that not only should we not favor the rich, but surprisingly, we should also not favor the poor (see also Ex. 23:3).  But why should we think this has applicability to taxation?  A main purpose of Leviticus is to show how the Israelites can live a holy life.  Chapter 19 is the pinnacle of how we live holy lives in relation to others, and the commands are given a solid reason—“I am the LORD”–which is repeated throughout the section.  Interestingly, Ch 19 is widely viewed as repeating the Decalogue; clearly Leviticus is summarizing the essence of what Holy Living looks like under God’s moral law.  In the middle of this section on Holy Living, comes verse 15, which describes what justice looks like.  Do we treat each other according to their just due?  Lev 19:15 helps us understand that a standard for personal holiness will be reflected in a standard for corporate holiness.  As John Hartley says in the Word Biblical Commentary, “Since God is just, his people must establish justice in their courts as the foundation of their covenant relationship with him.  The inner strength of a nation resides in the integrity of its judicial system.”  While, this is not dealing with taxation, it is dealing with justice in the social setting of the courts—it seems reasonable to conclude that if impartiality is required for the courts, it would be required of government action in general.  At least the burden of proof should be on those advocating for a system of partiality, given the extensive Biblical support of impartiality.**

For those that think this standard might only be applicable to the Old Testament, the same concept and appeal is made in James 2:8-10, where James condemns showing partiality to the rich who visit the church.  But do not think that somehow James would have been fine with partiality going in the other direction.  In his condemnation, James references Lev 19:18, “You shall love your neighbor as yourself,” and is summarizing what the law requires:

8 If, however, you are fulfilling the royal law according to the Scripture, “You shall love your neighbor as yourself,” you are doing well. 9 But if you show partiality, you are committing sin and are convicted by the law as transgressors. 10 For whoever keeps the whole law and yet stumbles in one point, he has become guilty of all.

Showing partiality makes you a lawbreaker; even in the New Testament, God’s standard of social relations is impartiality, carrying over the requirements of the Law to our New Covenant relations.  We often memorize James 2:10 to illustrate the necessity of salvation, since a works-based approach can never get you “clean” enough.  And that is well and good.  But let’s remember the context in James, and what it is that is offensive to God.  Even if you get everything else right—if you are showing partiality–you are against the will of God.

While this might be enough to convince many of us, others that have commented on previous posts argue that a progressive tax policy is impartial, since it treats everyone who makes a particular income level the same.  But there are two things that mitigate this view.  First, since God’s standard for impartiality has not changed, the closest thing we see to God’s “tax system” is in the tithe, and this was applied proportionally at a flat 10% rate.  To be sure, the purpose of the tithe was NOT what we have for the purpose of taxation in our modern state.  But the tithe was God’s designated mechanism to gather mandatory social contributions for “state” activities.  Lev 27 describes the 10% tithe to support the Levites, Deut. 14:22-26 describes a 2^nd tithe for celebratory purposes, while vv. 27-29 describe an additional tithe to support the poor.  Similar to taxes being collected for our contribution towards public services from which we benefit, much of the tithe also supported the giver through the various celebrations that were held.  The important point for our purposes is not what it was collected for, but rather how God commanded it to be collected:   equally from all, at the same percentage.  The rich surely had the same diminishing marginal utility in income that we have today, yet God applied this “tax” equally to all.  The tithe system treated income impartially, suggesting our tax system should likewise be impartial with respect to income.***

A second consideration for supporting a proportional tax is that some tax must be levied.  Since no one advocates a pure regressive tax, only a progressive tax is an alternative.  And progressive taxes have another problem.  While it is true that everyone that actually earns a billion dollars would be subject to the same tax rate, almost no American can ever expect to find himself/herself in that situation.  Thus there is a strong motivation to push taxes towards another income class, while advocating benefits that can primarily be shared by the lower/middle class.  This leads to advocating policies that were a private individual to do, would clearly be labeled as theft.  Let’s say I like the symphony.  I can support taxation on the rich to pay for a public symphony, “for the good of the community.”  While I would be arrested if I took a gun to my rich neighbor to demand funds to pay for a symphony I’d like to hear, we console ourselves if we effectively do the same thing by using the government as our collection agent.  To salve our guilty conscience, we convince ourselves that the rich are greedy, and have gotten this way only because of some nefarious conduct.  Or we say that since there is diminishing marginal utility in income, they won’t miss it as much as the poor–even though the poor don’t pay income taxes. They are lucky we don’t come after them for more than their money; our corrective shakedown is the only thing that prevents a more violent mob from coming at them with pitchforks.  Whipping up collective envy is the specialty of some politicians.  Are all people that are in favor of progressive taxation trying to create (or falling victim to) envy?  Of course not.  But many are—this is not a small concern.  I once had a privilege of eating lunch with R.C. Sproul in the late 1990s (with a few other students), and he related that he thought the progressive tax system was the single biggest corruptor of our collective morality.  You don’t have to agree completely with him to recognize it is a problem, and a significant temptation for our populist politicians.  It is a big enough risk that I argue we should avoid it.  There is nothing biblically to commend it (compared to the proportional alternative) and much to fear.

We live in a fallen world, and as such government is a necessary evil to restrain other evils that we would do to one another.  Government truly is an agent of God’s common grace, and we must fund it with a tax system.  Only a proportional tax system seems to be consistent with God’s requirement of impartiality, while the progressive taxation alternative has much to fear in corrupting our individual and collective character.

*  In all tax systems under public discussion there is some level of income that is not taxed; tax is applied on income above certain levels, whether progressively or proportionally.  In a famous flat tax proposal in the 1990s (Hall and Rabushka), the rate was 19% across all income, while excluding $22,500 from taxation for a family of four.  As they note in the report, you can make that exclusion higher, but then to generate the same revenue you must have a higher single rate.

** This includes those that advocate for a progressive tax rate on the economic view of diminishing marginal utility of money.  I don’t disagree with that concept, and I don’t disagree that it is consistent with the worldly view of fairness (only to a degree, since the poor effectively don’t pay income taxes in the U.S. {see table 2 of preceding hyperlink}).  However, my challenge is that this view of fairness is difficult to sync with the complete Biblical record.  God promises in many places (e.g., Psalm 73, Prov 13:11) that wealth that is obtained dishonestly will not last–He will “redistribute” this wealth.  He doesn’t need our help.

*** Some of the offerings did make allowance for poor people to give less, such as the Law of Guilt Offerings (Lev. 5).  That is why I think it is important to exclude the poor from the tax situation.  Many on the Christian left want to say that a reduction of taxes on the rich necessitates an increase in tax on the poor—that is patently false.  The poor pay no income taxes in the U.S., and every tax proposal has some level of income excluded from taxation to allow the necessities of life.  But once you are no longer considered poor—however we collectively define that—you contribute the same on each dollar of income.  And that is how the sacrificial and tithing system worked, and a proportional or flat tax would mirror that.