At the age of 16, I worked at a cabinet factory over the summer delivering counter tops, cleaning up around the shop, installing hardware, and performing whatever odd job that happened to arise. After two weeks of working 40 hours each week, I received my pay and pay stub. I saw that a fairly large portion had been taken in taxes. I accepted this because I did not know any better. It was the income tax and everybody paid it.
What I did not know at that time was this: For two weeks I had been advancing my labor and incurring a credit for work performed. So what does this mean? This means that the cabinet factory had incurred a debt and I a credit. The debt was the wage promised by the cabinet factory and the credit was the money owed at the end of the agreed upon pay period. How was such an arrangement agreed to? The cabinet factory proposed a wage and a pay period and I, having the choice to accept, deny, or renegotiate, chose to agree to their terms.
So I pose this question to you: Does the government have the authority to step between two private parties who have a private agreement and confiscate a portion of a debt owed? Was the money handed to me by the cabinet factory really “income” and had I earned a profit? Or had I just broke even? Both the cabinet factory and I agreed to the terms, so both of us must have benefited from the transaction. But, can this be considered profit or even income?
I assert that I did not “gain” or profit from my labor, I simply made what both I and the cabinet factory owners decided was an even trade. Today, however, the 16 Amendment to the United States Constitution is interpreted to mean Congress can tax anything that can increase your dollar holdings. If you find $10, receive a tip, win a bet, or inherit your parent’s property – it all belongs to the Federal Government and, by the good graces of Congress, you get to keep an arbitrary portion. Or at least that is the implication and mindset this amendment produces.
An even more sinister perspective is that the Federal Government owns me and my labor. If I do not perform any labor, they cannot take it away from me because it is not tangible. Once my labor is converted into something tangible, i.e. cash, they can now lay claim to my labor and confiscate whatever percentage they deem appropriate. Simply because there is a medium of transaction (paper money) between the cabinet factory and I does not change the nature of the arrangement – I am trading my labor for money which will in turn be used to purchase goods and services to fulfill my needs and wants. So what are they really taxing? In my estimation, they are taxing my ability to fulfill my needs and wants. And why are they taxing (for the most part, anyway)? To fulfill someone else’s needs and wants.
Perhaps you have never looked at labor and taxes this way and maybe you think it is stretch, but rest assured that when your labor-turned-cash touches your hands, a middle man has already (or will on April 15th) handled that money and claimed his percentage.