William O’Brien is Coordinator of The Alternative Seminary. He opines:
... The economic teachings of the covenant, then, begin by
expanding the seven-day cycle of Sabbath to the seventh year -- the
Sabbatical Year -- when the entire community is to let the land lie fallow,
forgive all debts, and free all slaves or bondservants (Lev. 25:1-7, Deut.
15). The land was to be given a periodic rest, and any tendencies toward
creeping oppression or bondage were to be released. Then, every seventh of
seven years was the Jubilee Year, in which, in addition to the sabbatical
provisions, the land was to be redistributed back to the original tribes and
families (Lev. 25:8-54).
... Are God's people commanded to -- gasp! -- redistribute wealth? Could
that possibly be in the Bible, along with not committing adultery and not
worshipping idols? "Redistribute the wealth" -- few words are more noxious
or notorious to American sensibilities. No notion is more blasphemous to our
free market ideology. And yet, God said it, and, the believer must assume,
God means it. ...
... Or, for religious Americans who claim to take
seriously the Bible as a revelation of God's will (and conservative U.S.
Christians are hardly shy in making such an assertion), perhaps we need to
do some serious wrestling here. God's holy people are clearly and undeniably
commanded to redistribute their holdings, to ensure that inequities of
wealth and poverty do not corrode their community, to make sure that none of
God's precious children have less than they need or more than they need.
Purim and Taxes: Paying Civilization's Price
by Ari Hart
Ari Hart is Co-founder, Uri L'Tzedek (Awaken to Justice): Orthodox
Social Justice. He opines:
... The Talmud offers two different approaches to the levying of
communal taxes. Either mamon - [the wealth of the payer] ... determines how
much is paid, or every person pays the same amount, which is called, in
talmudic parlance, a nefashot system. From the Talmud alone, it is not
entirely clear when to apply the different models. ... It is unclear from
these early sources whether or not mamon means a flat tax, or whether the
rate of taxation is actually progressive.
... Interestingly, in a bold reading of the earlier texts, the
Tzitz Eliezer assumes in his question that mamon is progressive. After an
in-depth review of halakhic sources, he concludes that nearly all taxes --
for water, road repair, lights, hospitals, social services, nursing homes
and more -- are assessed by mamon, which in his interpretation means
progressive.
2-4-8 Response: to O'Brien
In biblical days an honest tax collector (if you could
find one) would measure a man’s wealth and take a fair percentage for the
king. Today’s arbitrary income tax brackets (marginal rates) are somewhat
progressive but the investment class may defer or avoid taxes by simply not
selling assets such as corporate stock or real estate or by taking advantage
of other tax loopholes.
Many countries have net wealth taxes to
supplement both income and sales (or VAT) taxes but the wealth tax is
generally confined to multi-millionaires. Before the internet age, it was
very difficult to inventory and value assets – (including private
businesses). Today, for the first time in history, advances in computer
science and universal access to market data, make the administration of a
wealth tax so easy that it could readily be applied to all taxpayers.
For
example, taxing the $53 trillion in U.S. individual net wealth at 5% would
yield $2.6 trillion - $400 billion more than FY 2010 federal revenue. In the
alternative, a 2% net wealth tax (over a $15,000 exemption) combined with a
4% sales tax and 8% individual and corporate income tax would produce the
same revenue with very low tax rates for all. I call it the 2-4-8 Tax Blend.
It would be "Divine" – rich and poor paying the same progressive fair rates
(and keeping 92% of your income wouldn’t hurt).
Eugene Patrick Devany,
JD, MPA
Further 2-4-8 Response to Coments about
Valuation
Last week Warren Buffett said that he would be open to
a wealth tax but thought that business evaluation might be a problem. Of
course, Mr. Buffett is right.
The stock value is easy to determine for a publically
traded corporation but an inventory of assets would be needed for the
millions of private corporations and businesses. In most cases the small
businesses would be valued based upon a full liquidation of assets
computation. A standard adjustment would likely be made based upon sales and
earnings that go well beyond the average for the size and particular type of
company (and the IRS could be expected to publish acceptable guidelines). A
further (retroactive adjustment) might be needed where the business is
eventually sold for an amount that is significantly different from what had
been reported. A key difference with many private businesses is that the
principals of the company may account for much of the value of the business
and their non-contract expertise should not be valued for wealth tax
purposes. The valuation does not have to be perfect to be fair.
As a final point about private business, I would
support the free online public disclosure of all business wealth, sales and
income tax returns. Business Tax returns do not contain trade secrets and
the disclosure will certainly help to keep them honest.
Further 2-4-8 Response to Coments about
Liquidity
Mr. Combs has a good point about why a wealth tax
levied only against the rich (on top of a progressive income tax) is both
unfair and a very bad idea. Let me repeat that I opposes any wealth tax that
does not apply equally to rich and poor. Other countries with a wealth tax
(on the wealthy) include Pakistan, Philippines, Switzerland, etc.
Mr. Combs mentioned wealth leaving France, but wealth
cannot leave the U.S. because we have a worldwide tax jurisdiction (unlike
the “territorial†jurisdiction of most European countries [and which Mr.
Romney favors]).
I suspect most “Republicans†(if that is important to
you) and any business minded person would find it advantageous to save 25%
more salary each year in exchange for a 2% wealth tax. Because a wealth tax
serves the same function as “mark to market†rules and applies to all assets
(not just securities, real estate, precious metals, etc.) there is no need
to artificially compute an approximate (not adjusted for inflation) income
from capital gains.
2-4-8 Response: to Hart
I sponsor the website,
www.TaxNetWealth.com, and agree
with Rabbi Eliezer Waldenberg that it is, “a progressive approach, where we
tax according to the level of wealth†at the “same tax rateâ€. In contrast, a
flat rate tax on income or sales is regressive because it ignores need and
the ability of a person to pay.
[same as response to O'Brien]
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