TAXATION AND MORAL OBLIGATION

A just tax, as distinguished from fees, licenses, assessments, etc., may be defined as a compulsory contribution to the government, imposed in the common interest for the purpose of defraying the expenses incurred in carrying out the public functions or imposed for the purpose of regulation, without reference to the special benefits conferred on the one making the payment. Theologians generally divide taxes into direct and indirect, but the division is not perfect. A direct tax is immediately imposed on the person himself, even though it may be imposed because of an individual's goods, trade, or business (in general all per capita taxes). An indirect tax is directly imposed on goods and affects the person only indirectly (customs, duties, sales tax).

General Catholic Doctrine. Scripture affirms the existence of a moral obligation to pay taxes. The three synoptic Gospels record as a saying of Christ with regard to paying the tribute to Caesar: "Render, therefore, to Caesar the things that are Caesar's, and to God the things that are God's" (Mt 22.21; cf. Mk 12.13–17; Lk 20.20–26). St. Paul in a discussion of civil authority as coming from God speaks of the duty of paying taxes: "For this is also why you pay tribute, for they are the ministers of God, serving unto this very end. Render to all men whatever is their due; tribute to whom tribute is due; taxes to whom taxes are due …" (Rom 13.6–7). The Fathers of the Church, especially in their comments upon St. Paul, teach the moral obligation of paying taxes. Pius XII merely reiterated the constant teaching of the Church in a letter of Oct. 2, 1956: "There can be no doubt concerning the duty of each citizen to bear a part of the public expense. But the state on its part, insofar as it is charged with protecting and promoting the common good of its citizens, is under an obligation to assess upon them only necessary levies, which are, furthermore, proportionate to their means" [original Fr. Osservatore Romano, Oct. 4, 1956; English Pope Speaks, 3 (1957) 327].

Moral Theology. There are four theories among Catholic moralists about the exact nature of the moral obligation of paying just taxes.

Penal Law Theory. According to this, there is no moral obligation to pay the tax but only to accept the penalty, if penalty is imposed for the failure to do so. Later theologians attribute the penal law theory to Angelo Carletti di Chivasso (d. 1495) and Martin aspilcueta (Doctor Navarrus; d. 1586). However, it is not at all clear that these theologians would have applied penal law theory to such taxation as exists at the present time. Two fundamental reasons account for the theory—the desire to save citizens from burdensome and unfair taxation and a somewhat voluntaristic concept of law. Among contemporary theologians there is a growing tendency to deny the existence of purely penal laws. In addition, Scripture and the repeated teaching in the Church appear to demand a moral obligation with regard to payment of the taxes themselves and not one that binds only regarding the acceptance of the penalty.

Commutative Justice Theory. The moral obligation of paying taxes stems from the virtue of commutative justice. This theory was originally based on a presumed contract or pact between the individual and the state. The tax is the price paid by the citizen for the services rendered to him and for him by the state. This theory rests, therefore, on what many theologians consider a misunderstanding of the relationship between the individual and society. Similarly, explanations proposed by some modern theologians and based on the right of eminent domain or the principle that the state incurs expenses in the name of all are not acceptable to most theologians.

Legal Justice Theory for Direct Taxes. Some theologians have taught that laws imposing indirect taxes are purely penal, whereas laws imposing direct taxes oblige from the virtue of legal justice. But the existence of purely penal laws is questionable; also, such a theory would be difficult to apply in practice because of the somewhat arbitrary distinction between direct and indirect taxes.

Legal Justice Theory for All Taxes. The more common opinion is that all just tax laws oblige in conscience from the virtue of legal justice. Legal justice, according to St. Thomas Aquinas, has the common good as its object. The individual member of society is bound to work and cooperate for the common good. Society needs tax revenue to provide for the common good. Consequently, the individual has an obligation in legal justice to pay just taxes. This theory has become more commonly held since greater attention has been paid to the relationship between the individual and society. Some speak of an obligation in social justice.

Government's Obligation. Distributive justice demands that the individual citizens be taxed according to their capabilities to support the common good. Tax legislation is unjust if it does not distribute the burden equally among the individual members of society. However, no human legislation can be perfect, and minor inequities do not render a tax law unjust.

Truly unjust tax laws do not oblige in conscience. In certain countries (especially under totalitarian or absolute political systems) tax laws might not be just. In some countries even today it is evident that the state knows of the existence of fraud and either levies correspondingly higher taxes to compensate for the fraud or simply accepts the existing situation. In such cases the conscientious Christian may defend himself against the unjust legislation.

Tax laws in the U.S., where income and corporation taxes are the most immediate concern for the majority, are generally just laws. However, some argue that the tax laws do not oblige in conscience for various reasons, for example, that much tax revenue is lost in graft, that tax revenues are frequently wasted, that taxes are levied for unreasonable purposes. However, the tax legislation of the U.S. appears to be a good example of a prudential ordering of reason (ordinatio rationis ). The procedure of estimating the budget, the system of checks and balances among the branches of government, the fact of representative government, the opposition of political parties and the very popular political platform of lowering taxes if at all possible—all these elements indicate that tax legislation in the U.S. is basically reasonable and just.

Bibliography: m. t. crowe, The Moral Obligation of Paying Just Taxes (CUA Studies in Sacred Theology 84; Washington 1944). p. land, "Evading Taxes Can't Be Justified in Conscience," Social Order 5 (1955) 121–125; "A Note on Tax Obligations," ibid. 276–277. c. cardijn and j. delepierre, Frauder … ou payer ses impôts (Brussels 1962). f. hamm, Zur Grundlegung und Geschichte der Steuermoral (Trier 1908). a. janssen, "Le Devoir fiscal," Ephemerides theologicae Lovanienses 27 (Bruges 1951) 105–113. o. von nellbreuning, Staatslexikon, ed. gÖrresgesellschaft, 8 v. (Freiburg 1957–63) 7:698–700. t. goffi, "La coscienza morale del contribuente," Divas Thomas 59 (Piacenza 1956) 283–293. p. m. thÉas, "L'Obligation morale de l'impôt," Documentation catholique 56 (1959) 757–758. l. babbini, "Le leggi fiscali obbligano in coscienza," Palestra del clero 39 (1960) 394–396. e. trabucchi, "A proposito di evasione fiscale," La civiltà cattolica 114 (Rome 1963) 1:119–130.

[c. e. curran]