Anarchoblogs

In its April 1976 issue, Reason magazine published an article by Karl J. Bray about tax resistance, called “Taxes Are Revolting!”

Bray was one of the founders of the U.S. Libertarian Party. He was also a tax protester of the “the federal income tax is unconstitutional and I can prove it” school. He did about as well as most people do with that argument, and was appealing his latest criminal conviction at the time of his death in 1978.

I find the American constitutionalist tax protester movement to be kind of monotonous. But the Reason article has some interest. For one thing, it introduced me to Mogens Gilstrup, of whom I was able to find a more complete description elsewhere:

Mogens Gilstrup led the Anti-tax Party called the Progress Party in Denmark. The party sought virtual elimination of all taxes in Denmark. It wanted to privatize almost all activities of the Government. The party even advocated that the defence budget should be reduced to only enough money to pay for an answering machine that would tell any caller “We capitulate” [in Russian!] It contested elections for the Folketing (Danish Parliament) in 1973 and received a sizable support of 15.9 per cent of the total votes polled and was then second largest party in the country. It managed to get about 13 per cent of votes in two subsequent elections also. Later, when the ruling government reduced the income tax rates considerably, the significance of the anti-tax party also got reduced. Meanwhile, its leader Gilstrup was jailed for tax evasion. Probably he may be one of the very few persons who evaded taxes openly (declared by him in a television interview) and faced punishment. However, the Progress Party continues to mobilize citizens against high taxes.

Gilstrup and his party appear to have mostly sidelined their anti-tax roots in favor of an anti-immigrant nationalism and racism, and the Progress Party has declined to asterisk status.

What also interests me about the article is the way Bray describes the tax protester movement of the time. Most adherents of this belief system today restrict themselves to explaining why they think the tax system is illegal and why tax refusal is therefore a legal response. Bray instead highlights the tax protesters as a resistance movement fighting against noxious government policies:

The September 17, 1973, issue of U.S. 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.” [Something Bray himself wrote on his tax return in lieu of the figures the government instructed him to write there.]

There is little doubt that the movement is growing, and its leaders believe that the 16^th amendment to the U.S. Constitution, which authorizes the income tax, will soon fall, as did the 18^th amendment enacting Prohibition. It is historical fact that the 18^th 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.

Note the emphasis on resisting in order to have the 16^th amendment made a dead letter by the pressure of citizen protest — whereas most tax protesters of this school these days start from the assumption that this amendment is already invalid or that (when properly parsed) it doesn’t actually authorize the federal income tax, and say that they are resisting not to make this so, but because it is already so.

Bray goes on to describe some of the methods used by these tax protesters to avoid paying federal income tax. They sound pretty sketchy to me, and I’d be surprised if any of them amounted to good advice, but maybe back then some of them worked to some extent:

• “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.”
• “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.’”
• “The fifth amendment approach is quite straight-forward: the ex-taxpayer merely places the fifth amendment objection to self-incrimination in each blank space in the 1040 return where his answer to the question may tend to incriminate him.”
• “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.”

Bray plugs the Libertarian Party’s ballot-box approach to tax protest as well:

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.

If this was an accurate description of the original Libertarian Party of Karl Bray it sure isn’t an accurate description of today’s considerably more government-accommodating Libertarian Party (of, say, Bob Barr).