luckydog1
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real says
,"wages before revisionists got a hold of it were property an equal exchange not instruments of wealth and needed for survival etc therefore non taxable."
However the courts disagree...
Wages cannot be taxed because the exercise of a fundamental right cannot be taxed and the right to work is a fundamental right reserved to the citizens of the United States by the 10th Amendment to the Constitution.
This is absolutely wrong in every way.
The idea that there may be rights or privileges that are exempt from taxation has been rejected from the very beginnings of the United States. In rejecting such a claim in 1830, Chief Justice Marshall wrote:
“The power of legislation, and consequently of taxation, operates on all the persons and property belonging to the body politic. This is an original principle, which has its foundation in society itself. It is granted by all, for the benefit of all. It resides in government as a part of itself, and need not be reserved when property of any description, or the right to use it in any manner, is granted to individuals or corporate bodies. However absolute the right of an individual may be, it is still in the nature of that right, that it must bear a portion of the public burthens; and that portion must be determined by the legislature.”
Providence Bank v. Billings, 29 U.S. 514, 563 (1830), (emphasis added).
In upholding the power of New York to tax a bequest to the United States, the Supreme Court observed in 1896 that:
“[T]he laws of all civilized states recognize in every citizen the absolute right to his own earnings, and to the enjoyment of his own property, and the increase thereof, during his life, except so far as the state may require him to contribute his share for public expenses....”
United States v. Perkins, 163 U.S. 625, 627 (1896).
So even rights that the Supreme Court refers to as “absolute“ may be subject to tax.
The idea that the “right to work” is somehow exempt from tax was expressly refuted by the Supreme Court in 1937, upholding the constitutionality of the Social Security tax paid by employers on wages:
“But natural rights, so called, are as much subject to taxation as rights of lesser importance. An excise is not limited to vocations or activities that may be prohibited altogether. It is not limited to those that are the outcome of a franchise. It extends to vocations or activities pursued as of common right.”
Charles C. Steward Machine Co. v. Davis, 301 U.S. 548 (1937).
On the same day that the Steward Machine case was decided, the same justices confirmed the same principle in upholding the constitutionality of an Alabama unemployment tax:
“Taxes, which are but the means of distributing the burden of the cost of government, are commonly levied on property or its use, but they may likewise be laid on the exercise of personal rights and privileges. As has been pointed out by the opinion in the Chas. C. Steward Machine Co. Case, such levies, including taxes on the exercise of the right to employ or to be employed, were known in England and the Colonies before the adoption of the Constitution, and must be taken to be embraced within the wide range of choice of subjects of taxation....”
Carmichael v. Southern Coal & Coke Co., 301 U.S. 495, 508 (1937).
The idea that Congress is limited by “natural law” was more recently rejected in Koar v. United States, 98-2 U.S. Tax Cas. P50,748, 82 A.F.T.R.2d 6329 (S.D.N.Y. 1999). In dismissing a suit for the refund of all federal income tax, social security, and Medicare contributions withheld from the plaintiff’s wages between 1993 and 1994, Judge Kimba Wood wrote:
“Plaintiff thus appears to argue that this Court should look to principles of natural law, or more accurately, his preferred principles of natural law, as opposed to the positive law by which it is bound. That, however, is not this province of this Court.”
Judge Wood then quoted from the opinion of Justice Iredell in Calder v. Bull, 3 U.S. 386, 398-99 (1798) (opinion dissenting in part):
“If, on the other hand, the Legislature of the Union, or the Legislature of any member of the Union, shall pass a law, within the general scope of their constitutional power, the Court cannot pronounce it to be void, merely because it is, in their judgment, contrary to the principles of natural justice. The ideas of natural justice are regulated by no fixed standard: the ablest and the purest men have differed upon the subject; and all that the Court could properly say, in such an event, would be, that the Legislature (possessed of an equal right of opinion) had passed an act which, in the opinion of the judges, was inconsistent with the abstract principles of natural justice.”
Under this principle of constitutional law, the courts cannot refuse to enforce the federal income tax merely because one or more judges believe that the tax is contrary to their concepts of “natural law” or “natural rights.”
Tax Protester “Evidence”
The belief that “natural rights” cannot be taxed is purely wishful thinking, but tax protesters sometimes cite some misleading quotations from irrelevant cases that they think support their position, such as:
“The right to live and own property are natural rights for the enjoyment of which an excise can not be imposed.”
Redfield v. Fisher, 135 Or. 180, 292 P. 813 (1930), reh’g den., 135 Or. 205, 295 P. 461 (1931).
But that is a decision of the Oregon Supreme Court, not a federal court, and the tax in question was not even an income tax. Oregon has an income tax, and the Oregon courts enforce it. For example:
“Taxpayer cites Redfield v. Fisher, 135 Or 180, 292 P 813 (1930) reh’g den, 135 Or 205, 295 P 461 (1931) for the proposition that an individual, unlike a corporation, may not be taxed for the mere privilege of existing. He then extends that statement to encompass the act of earning a living. That extension is erroneous. The court in Redfield knew of, and in no way questioned, the then existing Oregon tax on the income of individuals.”
Clark v. Dept. of Revenue, TC 4604, note 3 (Or. Tax Court 10/6/2003) (sanctions of $5,000 imposed against the taxpayer for bringing a frivolous appeal, arguing “that a citizen of Oregon is not liable for Oregon personal income tax on wages”).
Another case often cited by tax protesters is from Arkansas:
“An income tax is neither a property tax nor a tax on occupations of common right, but is an excise tax...The legislature may declare as ‘privileged’ and tax as such for state revenue, those pursuits not matters of common right, but it has no power to declare as a ‘privilege’ and tax for revenue purposes, occupations that are of common right.”
Sims v. Ahrens, 167 Ark. 557, 271 S.W. 720 (1925).
That decision is from the Arkansas Supreme Court, and not the United States Supreme Court, and is about the Arkansas Constitution, and not the United States Constitution. Even worse, the quotation is from what turned out to be the minority opinion, so it’s not even a correct statement of the law in Arkansas. The majority opinion was as follows:
“My conclusion of the whole matter is that there are two, and only two, limitations in our [state] Constitution upon the power of the state to raise revenue for state purposes, namely (1) that taxes on property must be ad valorem, equal and uniform; and (2) that the Legislature cannot lay a tax for state revenue on occupations that are of common right. A tax on incomes is neither a property tax nor an occupation tax, and is not prohibited or excluded by our Constitution.“
Sims v. Ahrens, 167 Ark. 557, 271 S.W. 720 (1925) (emphasis added).
Attempting to establish that “rights” cannot be taxed, tax protesters will also cite:
“A state may not impose a charge for the enjoyment of a right granted by the federal constitution.”
Murdock v Pennsylvania, 319 US 105, 113 (1943).
But the court in the very next sentence declared that “Thus, it [the state] may not exact a license tax for the privilege of carrying on interstate commerce (citation omitted), although it may tax the property used in, or the income derived from, that commerce, so long as those taxes are not discriminatory.” Which means that, regardless of whether a state can tax the “right to work,” the state can still tax the income from the exercise of that right. Accord, Allison McCoy v. United States, 88 AFTR2d Par. 2001-5607, 2001 TNT 236-16, No. 3:00-CV-2786-M (U.S.D.C. N.D.Tex. 11/16/2001).
And the Supreme Court has repeatedly stated that nondiscriminatory taxes can apply to newspapers and other publications protected by the First Amendment. (“It is beyond dispute that the States and the Federal Government can subject newspapers to generally applicable economic regulations [including taxes] without creating constitutional problems.” Minneapolis Star & Tribune v. Minnesota Commissioner of Revenue, 460 U.S. 575, 581 (1983). See also, Arkansas Writers’ Project v. Ragland, 481 U.S. 221, 228 (1987) (“a genuinely nondiscriminatory tax on the receipts of newspapers would be constitutionally permissible”); Grosjean v. American Press, 297 U.S. 233, 250 (1936) (“It is not intended by anything we have said to suggest that the owners of newspapers are immune from any of the ordinary forms of taxation for support of the government.”). Similarly, the Supreme Court has upheld an obligation to withhold Social Security taxes from the wages of employees even when the withholding violates the religious beliefs of the employer. United States v. Lee, 455 U.S. 252 (1982).
So the Supreme Court has consistently upheld the imposition of taxes on incomes even when the incomes are derived from the exercise of constitutional rights.
Feel free to cite any cases that show otherwise real.
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