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April 14, 2013

Column: High taxes are no guarantee of high culture

“Taxes are what we pay for a civilized society,” said Justice Oliver Wendell Holmes Jr.

Liberal politicians, special-interest groups and writers love this quote, which is inscribed on their favorite Washington building, the headquarters of the IRS.

As I say every year in various venues during Tax Month: Justice Holmes said this in a speech in 1904. He repeated it in a court decision in 1927. There was no federal or state income tax in 1904. The 16th Amendment was ratified in 1913, and by 1927 the federal rate was 1.5 percent on incomes up to $52,780 (inflation-adjusted). The really rich paid 7 percent.

Today the rate for a single person making $11,000 is 15 percent; the richer have paid much higher rates over the years. Massachusetts had no state income tax until 1916, no sales tax until 1966; when the sales tax was passed it was 3 percent, intended to lower property taxes. Now the state income tax rate is 5.25 percent, the sales tax 6.25 percent. Property taxes were finally limited by Proposition 2 ½ but are still high.

So what does this all have to do with a civilized society?

It’s not as easy as I thought to find a definition of civilization. I found this at an online dictionary: “an advanced state of human society, in which a high level of culture, science, industry, and government has been reached.”

No, that can’t be right. Except for science, can we honestly state that any of these categories are at a higher level than they were in 1904 or 1927? I suppose it’s not fair to point out that after the income tax was passed, we participated in two terrible world wars, both started by a country that also had taxes; in between, we endured the Great Depression. “Culture” that ranged from opera to folk tunes now includes reality TV, rap and grunge. Government? By definition, the phrase “high level” probably hasn’t applied since the short reign of King Solon in Greece, 594 BC.

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