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On RH Law, Income Taxation and Involuntary Servitude

January 8, 2013

Someone made the following comment. Basically I was asked to comment on whether income taxation is unconstitutional on the grounds that it is confiscatory, or that it takes away man’s right to life, liberty and pursuit of happiness without due process of the law.

Here’s what the commenter said:

“First of all thank you for sharing us the secular nature of the RH law with respect to its constitutionality. However, it got me thinking as well that within the same line of argument you have on the RH law, will that also makes income taxation unconstitutional as well on the grounds that it takes away your right to life, liberty and pursuit of happiness without due process of the law?”

I found that comment very interesting so I gave the following response.

Hi Eldi,

I stated the following (in case you missed that part):

“You can argue by asking: Are you saying the government should not resort to taxation, which is a form of legal force?

“While I’m against taxation, the point, when it comes to this RH law issue (to make it clearer), is the government cannot and should not legislate charity. Charity or help should be personal and voluntary.”

Let’s never forget that we borrowed certain concepts, doctrines and constitutional provisions from the Americans without understanding their system of government (Republicanism and Federalism). We also borrowed their concept or policy of income taxation. The Americans introduced income taxation only in 1913 or during the progressive era (the rule of the statist liberals) following the ratification of the Sixteenth Amendment. Today, many American constitutionalists still hold the classical, originalist view that income taxation is unconstitutional. That income taxation is theft. That the founding fathers frowned upon this confiscatory policy.

Here are basic facts about our Constitution or form of government:

  1. There are many contradictions in the constitution
  2. We are a welfare state due to the Charter’s many welfare provisions
  3. We are not a Republican government
  4. Our charter regards income taxation as part of state powers (this is what is being taught in all law schools in the country today)
  5. The charter provides a distorted, contradictory, cannibalistic concept of rights
  6. Taxation- including income taxation- is originally part of the Charter

In the United States income tax was first introduced by Abraham Lincoln in 1862, but it was purely for a limited, specific purpose: to help pay for expenses caused by the Civil war. Lincoln’s revenue-generating measure imposed a 3% tax on Americans earning between $600 to $1200 and a 5% tax on those earning $10,000 above. This federal tax was a flat rate income tax. Wait! The GDP per capita in the Philippines in 2011 was $4,100. Yes, many Americans were already earning over  $10,000 more than 150 years ago, plus their money was still backed by gold.

The income tax law was repealed in 1872, or seven years when the civil war ended, and declared to be unconstitutional.

Now you must understand that with the many contradictions and welfare provisions in the Constitution, the government is empowered to use force against certain people to serve others. That constitutes involuntary servitude. However, we all know that the bill of rights guarantees our right to equal protection, property, life, etc. If we’re rightfully entitled to our property, then, can the government force us to render “free” services to others?

Remember that doctors and employers are already taxed by our laws.

Also, while the Charter legitimizes income taxation, it abhors involuntary servitude: “No involuntary servitude in any form shall exist except as a punishment for a crime whereof the party shall have been duly convicted.”

This means that it’s up to the justices of the SC to weigh these contradictions up and uphold justice.

Let’s just put aside income taxation, which is originally and already part of the Charter. Let’s just focus on the issue of ‘constitutional contradictions’. We may argue before the court the following: Yes, the law is (pr may be) constitutional, but is it proper? Is it proper to use government force against some group of people in order to serve the welfare of the poor or indigent women? Is it proper for the government to violate some people’s freedom of conscience and freedom of religion to serve what it calls the “greater good” or the “common good”?

Because if that kind of “force” were proper, then I say, the power of the government must be unlimited when it comes to serving the welfare of the poor. That, for instance, it can also force property owners to surrender portions of their property to the state for redistribution. That it can also order housing companies and estate developers to lower the prices of their housing products to serve the country’s homeless.

The best thing we can do now is, expose and exploit the many fatal contradictions in the Constitution.

Here’s my personal belief.

Justice transcends time and political expediency. Justice is above our Constitution. Justice and individual rights are PART OF OUR NATURAL, “INNATE” RIGHTS. In fact, should the government turn to tyranny after disarming us, justice and individual rights demand that we ABOLISH IT.

But is income tax in the Philippines unconstitutional? There are only two possible answers to this question since the 1987 is filled with contradictions and conflicting principles. The two possible answers are as follows:

Income taxation is constitutional: The Supreme Court may affirm the constitutionality of income tax using the State’s taxing power theory. Remember that every political science or law student in the country is being taught about the State’s power to tax or even to take a private individual’s property through its power of imminent domain, which is one of the anti-principles America’s founding fathers should not have adopted.

The Constitution provides the following provisions on the issue of taxation:

  • “The rule of taxation shall be uniform and equitable. The Congress shall evolve a progressive system of taxation.”
  • “Charitable institutions, churches and personages or convents appurtenant thereto, mosques, non-profit cemeteries, and all lands, buildings, and improvements, actually, directly, and exclusively used for religious, charitable, or educational purposes shall be exempt from taxation. “
  • “No law granting any tax exemption shall be passed without the concurrence of a majority of all the Members of the Congress.”
  • “All money collected on any tax levied for a special purpose shall be treated as a special fund and paid out for such purpose only. If the purpose for which a special fund was created has been fulfilled or abandoned, the balance, if any, shall be transferred to the general funds of the Government.”
  • Only the Supreme Court shall have the power to review, revise, reverse, modify, or affirm on appeal or certiorari “All cases involving the legality of any tax, impost, assessment, or toll, or any penalty imposed in relation thereto.”

Income tax is unconstitutional: However, the Supreme Court may declare as unconstitutional, unjust or illegal income taxation using individual rights and involuntary servitude arguments. That is, the high court may strike down this state’s confiscatory power by affirming the right of every individual to his/her income or to the fruits of his/her labor, which cannot be confiscated or taken away by the away without due process of law.

HELPFUL EXTERNAL LINKS:

A Brief History of Income Taxes

What is the problem with the income tax?

Ron Paul on on the Unconstitutionality of Income Tax

11 Comments leave one →
  1. GabbyD permalink
    January 8, 2013 3:38

    you are against taxation?

    how will the govt perform the functions it needs to perform, that even you believe that they should perform?

    • January 8, 2013 3:38

      While I’m against taxation, I believe its abolition is not among the first reforms. It would be economically disastrous to suddenly remove taxation from the political equation. Its abolition should be very gradual. But first, there is a need to establish a limited government with free market economy. It means there should be constitutional reform first, which is apparently not going to happen within the next five to ten years. The New Charter should be as concise as the American Charter (without the provisions on imminent domain and income taxation). Meaning to say, the Charter should contain only of motherhood provisions. The only power of government is to protect rights. There should be no rights to welfare whatsoever.

      That means that government expenses should be very minimal, as revenues would only be used to finance three major functions of government: courts, military, and police. Of course, the government may still establish offices for property registration, contract registration, etc.

      Taxation should be voluntary. But there would be other sources of government revenue.

      They are as follows:

      1. Registration fees for businesses, companies, corporations, partnerships, professional ventures, etc. Registration is a requisite for contracts and agreements. So if you business is not registered, your contracts with other parties will have no legal effect.
      2. Registration fees of patents, trademarks, business names, discoveries, etc. This is for the protection of your intellectual property rights.
      3. If you want to obtain important documents from the government like birth certificate, an additional copy of your business registration certificate, among other important papers and effects, you have to pay a minimal amount.
      4. Registration of cars, vehicles, lands, condominiums, other movable and immovable properties require minimal fees. This is to register and protect your property rights.

      The service functions of these may be leased to private businesses. For instance, registration of cars and lands may be carried out by private companies after proper bidding. These companies would be bound by contract agreements they entered into with the government. So if they violated any terms of the contract, they may be liable under the law. —->>> https://fvdb.wordpress.com/2011/09/25/on-government-prison-and-free-market-financing/

      • GabbyD permalink
        January 9, 2013 3:38

        how about salaries of these people who enforce property rights disputes?

        how about trying to score these reforms, to determine if they are feasible.

      • January 9, 2013 3:38

        The courts? The collection from government financing schemes, including voluntary contribution, would be more than enough to pay for their salary.

      • GabbyD permalink
        January 9, 2013 3:38

        not just the courts. you have law enforcement, bureaucracy, etc to enforce all kinds of property rights and due process.

        what are financing schemes? is this just fees? currently, you’ll find that fees are a small portion of total costs of implementing and enforcing laws. you will be forced to lower salaries, and employment across the board. how many judges, cops, record keepers would u have under your scheme?

      • January 9, 2013 3:38

        I don’t think so. I’ve stated possible sources of government revenue or financing.

        1. Registration fees for businesses, companies, corporations, partnerships, professional ventures, etc. Registration is a requisite for contracts and agreements. So if you business is not registered, your contracts with other parties will have no legal effect.

        2. Registration fees of patents, trademarks, business names, discoveries, etc. This is for the protection of your intellectual property rights.

        3. If you want to obtain important documents from the government like birth certificate, an additional copy of your business registration certificate, among other important papers and effects, you have to pay a minimal amount.

        4. Registration of cars, vehicles, lands, condominiums, other movable and immovable properties require minimal fees. This is to register and protect your property rights.

        Registration of contracts as well.

        If the government performs its duties effectively and properly, people would be encouraged to contributed money to the government. The list of contributors, including companies or businesses, should also be publicized in the government website, portal, gazette, etc.

        Government’s revenue collection would be more than enough to pay for the salaries of government employees and expenses.

    • bogz permalink
      February 20, 2013 3:38

      “how will the govt perform the functions it needs to perform, that even you believe that they should perform?”

      What a statist question! You really are in favor of big government. It would be funnier if you ask the OP: “Who will build the road? Who will educate the people?”

      • bryan permalink
        March 17, 2013 3:38

        Who will make candies?

  2. GabbyD permalink
    January 9, 2013 3:38

    here’s what:

    i challenge you to come up with numbers to support your proposal. try to prove, with numbers, that its plausible, and describe, what govt would look like with your reforms.

    you have the ideology part down. now, the onus is on you, as a believer, to prove that it can work with numbers.

    • January 10, 2013 3:38

      Challenge your empty brain first. No need to. It’s useless talking to a brain-dead…

      • GabbyD permalink
        January 10, 2013 3:38

        huh? why the hostility? numbers are a pre-req to making your policy recommendations move forward.

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