The Jewish Ethicist: Fair Tax
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The Jewish Ethicist: Fair Tax

The Jewish Ethicist: Fair Tax

One principle of fair taxation is payment according to benefit.

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Q. What are the Jewish principles of fair taxation?

A. In principle, Jewish law gives communities very wide latitude to decide on taxation systems. Jewish communities throughout the ages had a wide variety of taxation systems in terms of tax base (income, wealth, real estate, head tax), tax grades (progressive, proportional or regressive) and other parameters. There is certainly no one tax or tax system that is dictated by Jewish law, and for that reason Jewish law also acknowledges the validity of the secular tax system as long as it was instituted by a legitimate political process.

But flexible does not mean arbitrary. There are some basic principles of fairness against which taxes were always measured, and on occasion the rabbis struck down tax provisions because they were deemed inequitable.

In this column we will discuss one these principles; in forthcoming columns we will present others.

The Talmud establishes that the citizens of a city are authorized to impose a tax to build a wall for defense. The question arises how the tax burden is to be distributed.

Rebbe Elazar asked Rebbe Yochanan: When the collection is made, is it made per person or according to assets? He said to him, it is according to assets, and Elazar my son, fix it with nails. Others say, Rebbe Elazar asked Rebbe Yochanan: When the collection is made, is it made per person or according to proximity of the houses? He said to him, it is according to assets, and Elazar my son, fix it with nails. (1)

The commentators explain that the context is a wall to protect against bandits. Since the bandits are interested only in stealing property, they were not usually a danger to life. So a per person tax would be inappropriate – not everyone benefits equally from the wall. The fair thing is to collect according to assets, meaning moveable property that is vulnerable to theft. The second half can be viewed as suggesting an additional basis for the tax, besides the one proportional to assets. Even this, states Rebbe Yochanan, should have some direct connection to the benefit; bandits are in a big hurry to avoid detection and disproportionately attack houses closer to the edge of town; thus, those closest to the perimeter benefit more and pay more.

By contrast, if the danger is also from war, where there is mortal danger, it is fair to add a head tax as well, since even someone without assets is willing to pay to protect his life.(2)

From these sources we learn that when a tax is designated for a specific project, a very important consideration in the financing is the extent of benefit from the project. We also learn that this principle doesn't contradict having the wealthy pay more than their share of the costs; very often, as in this case, the wealthy benefit more from public projects than the poor.

SOURCES: (1) Babylonian Talmud 7b (2) Shulchan Arukh Choshen Mishpat 163:3

Published: December 19, 2010


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Visitor Comments: 8

(8) Dvirah, December 22, 2010 5:10 PM

Reply to Comment 4 (Terry Meyers)

Tax is an imposition if it is for the purpose of supporting a largely parasitic institution like the king's court. It is NOT an imposition when it is everyone pitching in to maintain services we all share. If all benefit, all should contribute. Regarding how much, wealth should be measure by how much over the minimum for basic necessities one has. The more extra one has, the more one can contribute.

(7) Harry Hamburger, December 22, 2010 2:24 AM

Fair taxes

They tax your income tax your home with the rest they tax your inheritance only the dead can rest Pharoah new well how to make men slaves tax them even lying in their graves!

(6) Anonymous, December 21, 2010 11:34 PM

repeal the tax law

WHEN THE PEOPLE ACT LIKE SHEET, THE GOVERNMENT ACTS LIKE WOLVES.. "WE THE PEOPLE" NOT WE THE GOVERNMENT! WE HAVE GIVEN THE GOVERNMENT THE POWER TO TAX US AND WE HAVE THE POWER TO REMOVE IT!! FREEDOM IS G-D GIVEN AND TAKEN AWAY BY GOVERNMENT,.. MAY HASHEM BLESS THE U.S.A. AND ALL WHO PROTECT HER..

(5) Larry, December 21, 2010 7:06 PM

Send a bill

The currrent US tax system is not kosher. :-) Taxation is NOT for charity. Charity is an individual responsibility and a Mitzvah. Individual charity build character and community. Forcible "charity" is theft of wealth, opportunity for mitzvah and causes a moral loss and dependency in the culture. Socialism is Avodah Zarah - estranging service which sacrifices the individual (a baby in idol worship times, the "rich person" today) for the "greater good" of society. The fairest method is payment for services. Send a bill according to benefit rather than focibly confiscate a person's wealth according to a socialist re-distribution formula. Communities pay for their needs and no one elses. Individual charity and personal insurance takes care of the poor and ill. In the interim see www.fairtax.org for a tax system that the government can't corrupt as easily through exemptions and which will eliminate all other taxes and the IRS. The Founders of the USA based their government on Moses' society and Torah values. To know what those values were and for a plan to restore that Torah based government see www.TheSocietyProject.org Thank you for your work towards Tikum Olam.

(4) Terry Myers, December 21, 2010 4:58 PM

All taxes are an imposition on freedom

Taxes are an imposition on my freedom and your freedom. Wealthy people make more money because they are creative and they take risks. Why penalize initiative and success? Who will do the bigger projects? We will, if someone (or group) wants to take the initiative -- medical research and education included. Right now, we cannot collectively do the bigger jobs because the government is taking such large amounts of our money that people avoid charity and let the government do it. Does Jewish law support wasteful spending? When 10% of government employees make over $150K that's waste. Or, how about healthcare waste imposed by government standards? Been to the hospital lately? Seen the waste in physical design, staffing, paperwork, needless testing, etc? Taxation to support expenditures beyond maintaining national defense, a court system to defend contracts, and a highway transportation system is enough. More taxes, Humbug!

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