References for Rethinking Taxation: an introduction to hourly averaging by Douglas Bamford

Including references in the book would have increased the size and therefore cost of it. I therefore promised to put these on my blog and here they are.

Ackerman, Bruce A. and Alstott, Anne, The stakeholder society (New Haven, Conn.: Yale University Press, 1999).

Allingham, Michael G. and Sandmo, Agnar, 'Income tax evasion: a theoretical analysis', Journal of Public Economics, 1/3–4 (1972), 323-38.

Andrews, William D., 'The Accessions Tax Proposal', Tax Law Review, 22 (1966), 589-634.

---, 'A Consumption-Type or Cash Flow Personal Income Tax', Harvard Law Review, 87/6 (1974), 1113-88.

Bamford, Douglas, 'Comprehensive lifetime taxation of international citizens: A solution to tax avoidance, tax competition, and tax unfairness', in Jeremy Leaman and Attiya Waris (eds.), Tax Justice And The Political Economy Of Global Capitalism, 1945 to the present day (Oxford: Berghahn Books, 2013).

---, 'Egalitarian Taxation: Equality of resources, market luck, and leisure', PhD thesis (University of Warwick, 2013).

Bardach, Eugene, 'Moral Suasion and Taxpayer Compliance', Law & Policy, 11/1 (1989), 49-69.

Barro, Robert and Grilli, Vittorio, European macroeconomics (Basingstoke: MacMillan Press, 1994).

Beccaria, Cesare, An essay on crimes and punishments, trans. Edward D. Ingraham (Philadelphia: Nicklin and Walker, 1819 (1764)).

Becker, Gary S., 'Crime and Punishment: An Economic Approach', Journal of Political Economy, 76/2 (1968), 169-217.

Bedau, Hugo Adam and Kelly, Erin, 'Punishment', Stanford Encyclopedia of Philosophy <http://plato.stanford.edu/entries/punishment/>, accessed 2nd August 2013.

Bentham, Jeremy, An Introduction to the Principles of Morals and Legislation (Oxford: Clarendon Press, 1907 [1780]).

---, Selected Writings on Utilitarianism (Ware, Herts.: Wordsworth, 2000).

Bittker, Boris, 'A "Comprehensive Tax Base" as a Goal of Income Tax Reform', Harvard Law Review, 80/5 (1967), 925-85.

Brennan, Geoffrey and Buchanan, James M., The power to tax : analytical foundations of a fiscal constitution (Cambridge: Cambridge University Press, 1980).

Brewer, Mike, Saez, Emmanuel, and Shephard, Andrew, 'Means-testing and Tax Rates on Earnings', in Stuart Adam, et al. (eds.), Dimensions of Tax Design: The Mirrlees Review (Oxford: Oxford University Press, 2010).

Brighouse, Harry, 'Egalitarian Liberalism and Justice in Education', The Political Quarterly, 73/2 (2002), 181-90.

Brighouse, Harry and Swift, Adam, 'Legitimate Parental Partiality', Philosophy & Public Affairs, 37/1 (2009), 43-80.

Buckner, Lisa and Yeandle, Sue, 'Valuing carers: Calculating the value of carers’ support', (Carers UK, 2011).

Bunting, Madeline, Willing Slaves: How the Overwork Culture Is Ruling Our Lives (Harper Perennial, 2004).

Card, David E. and Krueger, Alan B., Myth and measurement : the new economics of the minimum wage (Princeton, N.J.: Princeton University Press, 1995).

Choné, Philippe and Laroque, Guy, 'Optimal incentives for labor force participation', Journal of Public Economics, 89/2–3 (2005), 395-425.

Clark, Andrew, Georgellis, Yannis, and Sanfey, Peter, 'Scarring: The Psychological Impact of Past Unemployment', Economica, 68/270 (2001), 221-41.

Clayton, Matthew, 'Equal Inheritance: An Anti-Perfectionist View', in John Cunliffe and Guido Erreygers (eds.), Inherited Wealth, Justice and Equality (London: Routledge, 2012), 98-118.

Cunliffe, John and Erreygers, Guido, The origins of universal grants: an anthology of historical writings on basic capital and basic income (Basingstoke, Hampshire: Palgrave Macmillan, 2004).

Dietsch, Peter and Rixen, Thomas, 'Tax Competition and Global Background Justice', Journal of Political Philosophy,  (forthcoming).

Douglass, Frederick, 'An address on West India Emancipation', <http://www.lib.rochester.edu/index.cfm?PAGE=4398>

---, Two Speeches (Rochester, N.Y.: O. P. Dewey, 1857).

Dworkin, Ronald, 'What is Equality? Part 2: Equality of Resources', Philosophy & Public Affairs, 10/4 (1981), 283-345.

---, Sovereign Virtue (Cambridge, Mass: Harvard University Press, 2000).

---, Is Democracy Possible Here? (Princeton, N.J.: Princeton University Press, 2006).

---, Justice for hedgehogs (Cambridge, Mass.: Belknap Press of Harvard University Press, 2011).

Elgin, Ceyhun and Oztunali, Oguz, 'Shadow economies all around the world: Model-based estimates', <http://www.voxeu.org/article/shadow-economies-around-world-model-based-estimates>

Feige, Edgar L. and Urban, Ivica, 'Measuring underground (unobserved, non-observed, unrecorded) economies in transition countries: Can we trust GDP?', Journal of Comparative Economics, 36/2 (2008), 287-306.

Fleurbaey, Marc, Fairness, Responsibility and Welfare (Oxford: OUP, 2008).

Friedman, Milton, A Theory of the Consumption Function (Princeton: Princeton University Press, 1957).

Friedman, Milton, Capitalism and freedom (Chicago: University of Chicago Press, 1962).

Goode, Richard, 'The Economic Definition of Income', in Joseph A. Pechman (ed.), Comprehensive Income Taxation (Washington D.C.: Brookings Institute, 1977), 1-30.

Haig, Robert M., 'The Concept of Income—Economic and Legal Aspects', in Richard A. Musgrave and Carl S. Shoup (eds.), Readings in the Economics of Taxation (Homewood, Ill.: Irwin, for the American Economic Association, 1959).

Halbach, Edward C. Jr., 'An Accessions Tax', Real Property Probate & Trust Journal, 23 (1988), 211-27.

Harvey, Philip, Securing the right to employment : Social welfare policy and the Unemployed in the United States (Princeton, NJ: Princeton University Press, 1989).

---, 'Funding a Job Guarantee', International Journal of Environment, Workplace and Employment, 2/1 (2006), 114-32.

---, 'Securing the Right to Work at the State or Local Level with a Direct Job Creation Program', Big Ideas for Jobs Initiative <http://www.bigideasforjobs.org/wp-content/uploads/2011/09/Harvey-Full-Report-2-PDF.pdf>

Hirsch, Fred, Social limits to growth (Cambridge, Mass.: Harvard University Press, 1976).

Hirschman, Albert O., The Rhetoric of Reaction : perversity, futility, jeopardy (Cambridge, Mass.: Belknap Press of Harvard University Press, 1991).

Hobbes, Thomas, Leviathan (Harmondsworth, Eng.: Penguin, 1986 [1651]).

Jackson, Dudley, 'Thomas Hobbes' Theory of Taxation', Political Studies, 21/2 (1973), 175-82.

Kaldor, Nicholas, An expenditure tax (London: Allen & Unwin, 1955).

Keynes, John Maynard, The general theory of employment, interest and money (London: Macmillan, 1936).

Kirchler, Erich, The Economic Psychology of Tax Behaviour (Cambridge: Cambridge University Press, 2007).

Kirchler, Erich, Hoelzl, Erik, and Wahl, Ingrid, 'Enforced versus voluntary tax compliance: The “slippery slope” framework', Journal of Economic Psychology, 29/2 (2008), 210-25.

Laroque, Guy, 'Income Maintenance and Labor Force Participation', Econometrica, 73/2 (2005), 341-76.

Layard, Richard, Happiness : lessons from a new science (New York: Penguin Press, 2005).

Mankiw, N. Gregory, Macroeconomics (New York, NY: Worth, 2009).

Marx, Karl, Capital : a critique of political economy (London: Penguin, 1990 [1867]).

McCaffery, Edward J., Fair not flat: how to make the tax system better and simpler (Chicago: Chicago University Press, 2002).

Mill, John Stuart, Principles of Political Economy: Books IV and V (London: Penguin, 1970).

Minsky, Hyman, 'The Role of Employment Policy', in Margaret Gordon (ed.), Poverty in America (San Francisco: Chandler Publishing Company, 1965), 175-200.

Mirrlees, James A., 'An Exploration in the Theory of Optimum Income Taxation', The Review of Economic Studies, 38/2 (1971), 175-208.

Mirrlees, James A. and IFS, Tax by design : the Mirrlees review (Oxford: Oxford University Press, 2011).

Mitchell, William and Muysken, Joan, Full employment abandoned : shifting sands and policy failures (Cheltenham: Edward Elgar, 2008).

Mitchell, William F., 'The Buffer Stock Employment Model and the NAIRU: The Path to Full Employment', Journal of Economic Issues, 32/2 (1998), 547-55.

Modigliani, Franco and Abel, Andrew Bruce, The collected papers of Franco Modigliani vol. 2 : The Life Cycle of Hypothesis of Saving (Cambridge, Mass.: The MIT Press, 1980).

Mosler, W.B., 'Full Employment and Price Stability', Journal of Post Keynesian Economics, 20/2 (1998), 167-82.

Murphy, Liam and Nagel, Thomas, The Myth of Ownership: Taxes and Justice, (Oxford: OUP, 2002).

Nozick, Robert, Anarchy, State, and Utopia (Oxford: Blackwell, 1974).

Parfit, Derek, 'Equality or Priority?', in Matthew Clayton and Andrew Williams (eds.), The Ideal of Equality (Basingstoke: MacMillan, 2000), 81-125.

Pechman, Joseph A., Federal Tax Policy, Fourth Edition (Washington D.C.: The Brookings Institution, 1983).

Phelps, Edmund S., Rewarding Work : how to restore participation and self-support to free enterprise (Cambridge, Mass.: Harvard University Press, 1997).

Rakowski, Eric, Equal justice (Oxford: Clarendon Press, 1991).

Rawls, John, A Theory of Justice: Revised Edition (Oxford: Oxford University Press, 1999).

---, Justice as fairness : a restatement (Cambridge, Mass.: Harvard University Press, 2001).

Rudick, Harry J, 'A  Proposal for an Accessions Tax', Tax Law Review, 1/1 (1945), 25-44.

Saez, Emmanuel, 'Optimal Income Transfer Programs: Intensive versus Extensive Labor Supply Responses', The Quarterly Journal of Economics, 117/3 (2002), 1039-73.

Sandford, Cedric Thomas, et al., An accessions tax : a study of the desirability and feasibiliy of replacing the United Kingdom estate duty by a cumulative tax on recipients of gifts and inheritances (London: Institute for Fiscal Studies, 1973).

Schanz, Georg von, 'Der Einkommensbegriff und die Einkommensteuergesetze', Finanzarchiv, 13 (1896), 1–87.

Schlunk, Herwig J., 'A Lifetime Income Tax', Virginia Tax Review, 25/4 (2006), 939-76.

Schmalbeck, Richard, 'Income Averaging after Twenty Years: A Failed Experiment in Horizontal Equity', Duke Law Journal, 3 (1984), 509-80.

---, 'Income Averaging after Twenty Years: A Failed Experiment in Horizontal Equity', Duke Law Journal, 1984/3 (1984), 509-80.

Scholz, John T. and Lubell, Mark, 'Trust and Taxpaying: Testing the Heuristic Approach to Collective Action', American Journal of Political Science, 42/2 (1998), 398-417.

Seidman, Laurence, The USA Tax: A Progressive Consumption Tax (Cambridge, Mass.: MIT Press, 1997).

Sen, Amartya, 'Utilitarianism and Welfarism', The Journal of Philosophy, 76/9 (1979), 463-89.

Shaxson, Nicholas and O'Hagan, Ellie Mae, 'Mythbusters: "A Competitive tax system is a better tax system"', Mythbusters (London: New Economics Foundation, 2013).

Sigala, Maria, Burgoyne, Carole B., and Webley, Paul, 'Tax communication and social influence: evidence from a British sample', Journal of Community & Applied Social Psychology, 9/3 (1999), 237-41.

Simons, Henry Calvert, Personal income taxation : the definition of income as a problem of fiscal policy (Chicago, Ill.: University of Chicago Press, 1938).

Smith, Adam, An Inquiry into the Nature and Causes of the Wealth of Nations (New York: P F Collier and Son, 1909 [1784]).

Stigler, George J., 'The Economics of Minimum Wage Legislation', The American Economic Review, 36/3 (1946), 358-65.

Sugin, Linda, 'A Philosophical Objection to the Optimal Tax Model', Tax Law Review, 64 (2011), 229-81.

Swift, Adam, How not to be a hypocrite : school choice for the morally perplexed (London; New York: Routledge, 2003).

Thaler, Richard H. and Sunstein, Cass R., Nudge (Cornwall: Yale University Press, 2008).

Tiebout, Charles M., 'A Pure Theory of Local Expenditures', Journal of Political Economy, 64/5 (1956), 416-24.

Van Parijs, Philippe, Real freedom for all : what (if anything) can justify capitalism? (Oxford: Clarendon Press, 1995).

Veblen, Thorstein, The theory of the leisure class (New York: Modern Library, 2001 [1899]).

Vickrey, William, 'Averaging of Income for Income-Tax Purposes', Journal of Political Economy, 47/3 (1939), 379-97.

---, Agenda for Progressive Taxation (with a new introduction) (Clifton N.J.: Augustus M. Kelley, 1972).

---, Public economics: selected papers by William Vickrey (Cambridge: Cambridge University Press, 1994).

Wallace, Sally Martinez-Vazquez Jorge Alm James, Taxing the hard-to-tax Lessons from theory and practice (Bingley: Emerald Group Publishing Limited, 2010).

Warr, Peter, Jackson, Paul, and Banks, Michael, 'Unemployment and Mental Health: Some British Studies', Journal of Social Issues, 44/4 (1988), 47-68.

Wenzel, Michael, 'The impact of outcome orientation and justice concerns on tax compliance: The role of taxpayers' identity', Journal of Applied Psychology, 87/4 (2002), 629-45.

---, 'An analysis of norm processes in tax compliance', Journal of Economic Psychology, 25/2 (2004), 213-28.

---, 'Misperceptions of social norms about tax compliance: From theory to intervention', Journal of Economic Psychology, 26/6 (2005), 862-83.

---, 'A Letter from the Tax Office: Compliance Effects of Informational and Interpersonal Justice', Social Justice Research, 19/3 (2006), 345-64.

White, Stuart, 'The Egalitarian Earnings Subsidy Scheme', British Journal of Political Science, 29/4 (1999), 601-22.

---, The civic minimum : on the rights and obligations of economic citizenship (Oxford: Oxford University Press, 2003).

Williams, Andrew, 'Equality for the Ambitious', Philosophical Quarterly, 52 (2002), 377-89.

Winkelmann, Liliana and Winkelmann, Rainer, 'Why Are the Unemployed So Unhappy? Evidence from Panel Data', Economica, 65/257 (1998), 1-15.

Wray, R., Understanding Modern Money: The Key to Full Employment and Price Stability (Cheltenham, UK: Edward Elgar, 1998).

Zelenak, Lawrence, 'Taxing Endowment', Duke Law Journal, 55/6 (2006), 1145-82.

Wordcloud of Rethinking Taxation

I quite like wordclouds, so I've made one for my forthcoming book, rethinking taxation:

Enjoy.

Is it permissible for tax authorities to withdraw money from people’s accounts?

There has recently been a bit of a brew-ha-ha surrounding the HMRC proposal that they should have the right to directly take money from the accounts of taxpayers who are in debt. Some people are outraged by the proposal but I would cautiously accept it and I thought I would outline why.

In my forthcoming book I set out some principles of taxation and it is useful to consider the proposal in light of these. The principles that are immediately relevant are that the tax system should be just and that it should not interfere with people in making their plans. I would argue that the first principle mentioned tells in favour of the proposal and that the concerns raised under the second principle do not render the proposal impermissible.

A just tax system will be one in which the right people contribute the right amount of tax. People who consistently fail to pay their debts to the tax authority clearly undermine this. Furthermore, by failing to pay they increase the costs of tax administration and thereby reduce the net contribution they make below that which they could reasonably be expected to make. Making the tax system more effective by reducing costs and increasing revenues is a good thing all round and if the proposal can achieve this then there are good reasons to allow HMRC to take money from the accounts of non-payers.

The other principle that I mentioned is that the tax system should not interfere with people’s plans. It could be that if the tax authority takes money from someone’s account then this will render them unable to do something they were planning to do with the money. However, I do not find this argument compelling as an example of breaking the second principle. If people are given plenty of warning that they will have the money taken, perhaps with attempts at contact made through several forms of media, then there is no problem here. People should not be making plans with money that is not theirs and if people have a tax debt then the money is not theirs. In an ideal world the correct tax would be withheld at source but where this doesn’t happen the person who has the tax money does not have any prior right to this money.

A further related point is that people should not be making plans with money that isn’t theirs, and so the proposal would not violate the non-interference principle. This may lead some to suggest that my defence of the proposal also implies that all debtors should have the right to take money from people’s accounts. This would clearly be untenable and so how can the seemingly similar proposal be acceptable? Courts should have the right to seize assets from financial institutions where this has gone through the correct procedure, and HMRC can undertake these proceedings.

Why should HMRC be able to do what other debtors cannot? One reason is the one set out above; people have duties to contribute their tax revenues to society and these are a stronger claim than other debts that people have entered into as part of a contract. But these other debts are based on contracts that people have entered into freely, albeit ones that should be enforced by the state if one of the parties fails in duties they have adopted through the contract. The requirement to pay tax is not of this nature however—tax is not an agreement entered into between two parties but a moral requirement for people to pay their due to the rest of society. Everyone is required to pay no matter whether they would like to or not and so it is not like society has made the mistake of making a contract with someone of poor character.

There are of course reasonable worries about proposals such as this, and sensible rules must be applied to ensure that mischief is kept to a minimum. However, there is no good reason to assume that the proposed HMRC powers are morally impermissible. 

"Rethinking Taxation" available for pre-order!

Exciting news from Bamford Towers and Searching Finance:

My book "Rethinking Taxation: An introduction to hourly averaging" is available for pre-order from the Searching Finance website!

To find out more, and to order an advance copy with £5 off the RRP, click here.

I'm sure I'll be blogging more about the book in the coming weeks and months, including putting things on the blog that had to be removed to keep the length down to a reasonable amount (and therefore the book at a lower price).

Money breeds money: Not just common sense

I described in my previous post that the rich tend to get richer while the poor find it very hard to amass any serious amount of wealth. I mentioned several of the processes that are likely to drive this tendency.

Sometimes things that appear to be common sense don't turn out to be true once they have been properly studied: the sun doesn't go round the earth but the earth rotates as it goes around the sun.

However, an economist, Thomas Piketty, appears to have gone to great pains (600 pages!) to provide the evidence for the trends I mentioned in my last post. The fruits of this work is the book Capital in the twentieth century, and his explanations of it and the reviews I have read make me want to read it.

I tend to agree with Piketty's conclusion that this tendency towards concentration of wealth, along with any other fact about capitalism, does not create the need to have a total revolution. Such anti-capitalist conclusions are clearly too hasty; you would need something better to replace capitalism with. But it does remind us of the need for constant efforts at redistribution to check the undesirable tendencies of free markets.

This provides a further argument against libertarianism. Libertarians support free-market outcomes for at least one of several reasons, but as well as attacking those (wrong-headed) reasons we can also point out that their proposals will have poor consequences. Hugely unequal societies in which a larger and larger share of resources are held by a smaller and smaller minority is not many people's idea of a utopia (bizzarro's such as Ayn Rand excepted).

Furthermore, if such a (dis?)utopia came about it may even be worse for those who are very well off, if Wilkinson and Pickett are to be believed. These authors show that more unequal societies are less successful and happy than more equal societies.

My tax proposals are aimed to providing the most redistribution possible commensurate with good economic performance. This is done by taxing those who get unearned income at much higher rates while encouraging economically useful activities, transfers and exchanges.

Why the rich get richer, and what this means for the tax system

There have been lots of articles in the papers over the past week resulting from the recent Oxfam report into the richest poorest members of society. It seems that the richest five families in the UK have as much wealth as the poorest 20% put together. That is five families against nearly 13 million people. This is unsurprising in that the richest are the richest and have a hell of a lot while the poorest are the poorest and have little or nothing.

However, the scale of the difference does not indicate that some people are saving while others are spending. Richard Seymour’s piece highlights how this difference is largely a result of the adage that “money follows money,” “money begets money” or “money makes money.” These can be understood to mean that people who have money find it easy to make more money, or alternatively that the children of the rich end up rich themselves. Both of these are usually true unless there is a highly redistributive or economically restrictive regime.

There are obvious reasons why the rich can easily get richer while the poor will find it very difficult to get richer. The wealthy can give their spare money to financial institutions, or just sit on their property and watch it increase in value. The poor have to use most if not all their resources on the basic costs of living, leaving little left over for investment. Wealthier people, by contrast have the same amount of time available to them to work and earn in that way, while earning money on invested capital. Meanwhile, any money they earn can be invested rather than used for necessaries. Furthermore, poorer people may need to take jobs with few prospects as they need money quickly while richer people can take a longer view and more easily develop a career.

Of course, you may get rich people who are very bad with their money and blow it all. Occasionally someone from a less wealthy background will build a business or obtain a very highly paid career. But these are anomalies, and the processes described above will tend to lead to greater and greater concentration of wealth over time unless checked. Which leads on (did you guess?) to taxation.

If we are looking at what to tax, there are very clear arguments to tax the returns to capital in preference to taxes on the income and consumption of the less-well-off. Certainly revenues above the change in the value of money should be taxed on a progressive basis. This is not punitive—people should be able to invest and earn something from this after tax. The punitive approach would discourage investment and that would be very bad for the economy. But it still makes sense to be taxing returns to capital at high rates in order to reduce taxes on those with low incomes.

Unfortunately things seem to be going in the opposite direction in many ways, as I will discuss in my following blog. 

Happy times!

A few happy things to report.

The first is that my brother married Emily on Saturday and it was a wonderful day. For the first time I have a sister!

The second is that my paper "Realising International Justice" is available as an advance viewing. In the paper I argue that the requirements of background justice require the global taxation of international citizens, but that this does not require the creation of a global state or for all states to impose the same tax rates. Instead, I suggest that the employment of a counter-incentive would achieve the desired ends. I also explain my counter-incentive proposal in a book chapter published last year and in chapter eight my forthcoming book, Rethinking Taxation.

If you work at a university you might want to ask your librarians to subscribe if they do not already receive the Moral and Political Philosophy journal as part of a package. It should develop into an important journal in the field, and mine is the second paper it has made available.