View source for Tax choice

You do not have permission to edit this page, for the following reason:

This IP address range has been globally blocked.
This does not affect your ability to read Wikipedia pages.

Most people who see this message have done nothing wrong. Some kinds of blocks restrict editing from specific service providers or telecom companies in response to recent abuse or vandalism, and can sometimes affect other users who are unrelated to that abuse. Review the information below for assistance if you do not believe that you have done anything wrong.

This block affects editing on all Wikimedia wikis.

The IP address or range 62.210.0.0/16 has been globally blocked by ‪Hasley‬ for the following reason(s):

Open proxy/Webhost: See the help page if you are affected:

This block will expire on 16:21, 18 December 2025. Your current IP address is 62.210.136.28.

Even while globally blocked, you will usually still be able to edit pages on Meta-Wiki.

If you believe you were blocked by mistake, you can find additional information and instructions in the No open proxies global policy. Otherwise, to discuss the block please post a request for review on Meta-Wiki. You could also send an email to the stewards VRT queue at stewards@wikimedia.org including all above details.

Other useful links: Global blocks · Help:I have been blocked

You can view and copy the source of this page:

{{Short description|Concept that taxpayers should be able to choose what their taxes are used for}}
{{more footnotes|date=February 2012}}
{{Taxation}}
In [[public choice theory]], '''tax choice''' (sometimes called '''taxpayer sovereignty''',<ref name=brown>{{cite journal|last=Brown|first=Daniel J.|title=The Case for Tax-Target Plans|journal=Journal of Education Finance|date=Fall 1979|volume=5|issue=2|pages=215–224|jstor=40703229|publisher=University of Illinois Press|quote=For educators, these "new" values reflect a demand for taxpayer sovereignty, greater choice among educational programs, and more responsiveness on the part of educational systems.}}</ref> '''earmarking''', '''participatory taxation'''  or '''fiscal subsidiarity'''{{sfn|Buchanan|1963}}{{failed verification|date=February 2013}}) is an emerging type of [[citizen sourcing]] in which individuals or groups of taxpayers decide how to allocate part of their taxes of a [[municipal]] or public [[budget]] [[Appropriation (law)|appropriation]] through a process of democratic [[deliberation]] and decision-making. Its proponents apply the theory of [[consumer choice]] to [[public finance]]. They claim taxpayers react positively when they are allowed to allocate portions of their taxes to specific spending.<ref>{{cite magazine |last=Lamberton |first=Cait |title=Your Money, Your Choice | magazine=Democracy: A Journal of Ideas | date=4 March 2011 | url=https://democracyjournal.org/magazine/20/your-money-your-choice/}}</ref><ref>{{cite journal |author1=Sherry Xin Li |author2=Catherine Eckel |author3=Philip J. Grossman |author4=Tara Larson Brown |title=Do Earmarks Increase Giving to Government? |date=2011 |s2cid=168228863 }}</ref><ref>{{cite journal| doi=10.1016/0167-2681(93)90003-8 | volume=22 | issue=3 | title=Fiscal exchange, collective decision institutions, and tax compliance | year=1993 | journal=Journal of Economic Behavior & Organization | pages=285–303 | last1 = Alm | first1 = James | last2 = Jackson | first2 = Betty R. | last3 = McKee | first3 = Michael}}</ref>

Existing examples of tax choice includes: [[Business improvement districts|Business improvement district]] and [[Tax increment financing]].

== Tax relationship between the state and taxpayers ==
The term tax sovereignty emphasizes the perceived equal status of state and [[taxpayer]], instead of the traditional view of the dominant position of the state in [[taxation]]. Tracing back to the [[Legitimacy (political)|legitimacy]] of the state, Viktoria Raritska points out that “the legitimacy of the state as a formal institution is substantiated by the people’s refusal of their freedoms and an agreement to submit to government in exchange for the protection of their guaranteed rights”.<ref name=":1">{{Cite book|title=System of Financial Law : system of tax law : conference proceedings.|others=Masarykova univerzita. Katedra finančního práva a národního hospodářství.|year = 2015|isbn=978-80-210-7827-7|edition=1st|location=Brno|oclc=920663188}}</ref> Proponents of tax sovereignty believe that in a traditional system of taxation, the [[taxpayer]] gives up their [[Natural libertarianism|natural liberty]] in exchange for the protection from the state and the provision of [[public service]]s; which impels the state to take public interests as its obligation to maintain [[social order]] and [[Citizenship|citizen]] safety.

This mutual relationship makes [[taxation]] a link between the state and [[taxpayers]]. Proponents of tax sovereignty believe that in such a relationship, the taxpayer endows power to the state to ensure the satisfaction of the [[public interest]]. Furthermore, they propose that the [[taxpayer]] has granted the state tax sovereignty. “It is due to the fact that the taxpayer endows the state with tax sovereignty. Thus, state has not only the rights on taxation, but also the obligations, which correspond to the taxpayer's rights”.<ref name=":1" /> Therefore, the existence of the state's perceived tax sovereignty is attributed to the [[taxpayer]].

The Swedish economist [[Knut Wicksell]]’s theory also argues that "taxation should be based on the principle of value and counter-value, as if taxation was a voluntary transaction between the individual and the state".<ref>{{Cite journal|last=Johnsen|first=Garmann|date=December 1994|title=The impact of the Scandinavian controversy about just taxation on public choice; a late homage to Einar Einarson|journal=Public Choice|volume=81|issue=3–4|pages=323–338|doi=10.1007/bf01053236|s2cid=154569863|issn=0048-5829}}</ref>

== Opinions ==
Daniel J. Brown{{r|brown}} examines tax-target plans in educational programs.

[[Alan T. Peacock]], in his 1961 book ''The Welfare Society'',{{page needed|date=February 2013}} advocates greater diversity in public services (education, housing, hospitals).{{clarify|reason=is Peacock talking about tax choice as part of greater diversity?|date=February 2013}}

== Optimal quantities of public goods ==
According to Vincent and Elinor Ostrom, it is possible that government may oversupply, and a market arrangement may undersupply, those public goods for which exclusion is not feasible.<ref>Kennett, Patricia (2008). ''[https://books.google.com/books?id=SLRFLlIrqLsC&dq=Nevertheless%2C+the+classic+solution+to+the+problem+of+underprovision+of+public+goods+has+been+government+funding&pg=PA28 Governance, globalization and public policy]''. Edward Elgar Publishing. p.&nbsp;56. {{ISBN|978-1845424367}}</ref><ref>{{cite web |author1=Vincent Ostrom |author2=Elinor Ostrom |date=2003 |url=http://sobek.colorado.edu/~mciverj/Ostrom-PG&PC.PDF |title=Public Goods and Public Choices |url-status=dead |archive-url=https://web.archive.org/web/20050520201711/http://sobek.colorado.edu/~mciverj/Ostrom-PG&PC.PDF |archive-date=20 May 2005}}</ref>

== Foot voting versus tax choice ==
[[Foot voting]] and voting with one's taxes are two methods that have been proposed to allow taxpayers to reveal their preferences for public policies. Foot voting refers to where people move to areas that offer a more attractive [[Bundling (public choice)|bundle]] of public policies. In theory foot voting would force local governments to compete for taxpayers. Tax choice, on the other hand, would allow taxpayers to indicate their preferences with their individual taxes. [[Wallace E. Oates]] wrote: "In the [[Tiebout model]], for example, there is costless mobility; individuals seek out a jurisdiction that provides exactly the level of output of the public good that they wish to consume. In so doing, they reveal their preferences for 'local' public outputs and generate a [[Pareto-efficient]] outcome in the public sector."<ref>{{citation |last=Oates |first=Wallace E. |date=May 2006 |url=http://www.ifigr.org/publication/ifir_working_papers/IFIR-WP-2006-05.pdf |title=On the Theory and Practice of Fiscal Decentralization |location=Lexington, KY |publisher=Institute for Federalism and Intergovernmental Relations |url-status=dead |archive-url=https://web.archive.org/web/20081201085332/http://www.ifigr.org/publication/ifir_working_papers/IFIR-WP-2006-05.pdf |archive-date=1 December 2008}}</ref>

== Legislative measures ==
Four bills involving tax choice have been introduced by the United States Congress since 1971. The [[Presidential election campaign fund checkoff|Presidential Election Campaign Fund]], enacted in 1971, allows taxpayers to allocate $3 of their taxes to presidential election campaigns.<!--I think the current number is $3. Needs verification/updating.--> The 2000 Taxpayers’ Choice Debt Reduction Act would have allowed taxpayers to designate money toward reduction of the national debt.<ref>[http://www.govtrack.us/congress/bills/106/hr5349 Taxpayers’ Choice Debt Reduction Act]</ref> The 2007 Opt Out of Iraq War Act would have allowed taxpayers to designate money toward certain social programs.<ref>[http://www.govtrack.us/congress/bills/110/hr3190 Opt Out of Iraq War Act of 2007]</ref> The 2011 Put Your Money Where Your Mouth Is Act would have allowed taxpayers to make voluntary contributions (not tax payments) to the government.<ref>[http://www.govtrack.us/congress/bills/112/hr1541 Put Your Money Where Your Mouth Is Act]</ref><ref>Kasperowicz, Pete, [https://thehill.com/blogs/floor-action/house/88914-rep-campbell-proposes-tax-form-change-to-encourage-donations-to-the-government/ "Rep. Campbell proposes tax form change to encourage donations to the government"]. ''The Hill", 18 April 2011.</ref> These later bills died in committee.

== In popular culture ==
When asked what her first [[executive order]] as [[president of the United States]] would be, [[Ellen DeGeneres]] advocated a mix of [[voluntary taxation]] and tax choice, stating "you should get to choose where your money goes instead of giving it and just letting them decide, I think you should decide."<ref>{{cite AV media | people = Ellen DeGeneres, Mario Lopez | date=4 May 2016 | title=What Ellen DeGeneres Would Do If She Were President | language = English | url=http://extratv.com/videos/0-o2eskl66/ | archive-url=https://web.archive.org/web/20160507230653/http://extratv.com/videos/0-o2eskl66 | archive-date = 7 May 2016 | url-status=live | publisher = [[Extra (U.S. TV program)|Extra]]}}</ref>

In 2009, during the [[Great Recession]], [[Pope Benedict XVI]] advocated for a form of tax choice in his third [[encyclical]]. He wrote: "One possible approach to development aid would be to apply effectively what is known as fiscal subsidiarity, allowing citizens to decide how to allocate a portion of the taxes they pay to the State. Provided it does not degenerate into the promotion of special interests, this can help to stimulate forms of welfare solidarity from below, with obvious benefits in the area of solidarity for development as well."<ref>{{cite web|url=https://www.vatican.va/holy_father/benedict_xvi/encyclicals/documents/hf_ben-xvi_enc_20090629_caritas-in-veritate_en.html |title=Caritas in Veritate 'Charity in Truth' |publisher=[[Vatican Publishing House]] |author=Benedict XVI |date=7 July 2009 |access-date=7 July 2009 |url-status=live|archive-url=https://web.archive.org/web/20110902070515/https://www.vatican.va/holy_father/benedict_xvi/encyclicals/documents/hf_ben-xvi_enc_20090629_caritas-in-veritate_en.html|archive-date=2 September 2011}}</ref>

In 1983, a short story ''[https://web.archive.org/web/20120731233311/http://www.sff.net/people/jack.haldeman/people.htm We, The People]'' by [[science-fiction]] writer [[Jack C. Haldeman II]]. The plot of the short story involves a man offered the choice to participate in allocating his taxes with the assistance of [[Artificial intelligence]].

: "We, the People," written in a flush of bitter anger, but with an undertone of hope -- has over the years gathered me more response than anything else I've ever written. I was told that someone once sent copies to all the members of the Senate when they were considering tax reform. It has been used in classrooms to teach the critical difference between a Democracy and a Republic. I wrote it years ago, but I feel it is as pertinent today as it was when it appeared in Analog magazine. - Jack C. Haldeman II, [https://web.archive.org/web/20120606123111/http://www.sff.net/people/jack.haldeman/polit.htm Political Science Fiction]

The short science fiction story by Jack C. Haldeman II, ''We, The People'' was originally published in September 1983 in [[Analog Science Fiction and Fact|ANALOG]].

== Examples ==

=== Iceland ===
Taxpayers in Iceland who belong to an [[Religion in Iceland|officially registered religious group]] or secular humanist organization<ref name="report2014">{{cite web | url=https://2009-2017.state.gov/j/drl/rls/irf/religiousfreedom/index.htm?year=2014&dlid=238390 | title=International Religious Freedom Report for 2014: Iceland | access-date=2015-12-07 | author=Bureau of Democracy, Human Rights and Labor | date=2014 | publisher=[[U.S. Department of State]]}}</ref> must pay a congregation tax (Icelandic: ''sóknargjald'', plural ''sóknargjöld'')<ref name="innan">{{cite web | url=https://www.innanrikisraduneyti.is/raduneyti/starfssvid/kirkjumal/almennt/ | title=Kirkjumál og skráð trúfélög og lífsskoðunarfélög | access-date=2015-12-07 | publisher=[[Minister of the Interior (Iceland)|Ministry of the Interior]] (Innanríkisráðuneytið) | language=is | archive-url=https://web.archive.org/web/20160323172941/https://www.innanrikisraduneyti.is/raduneyti/starfssvid/kirkjumal/almennt/ | archive-date=2016-03-23 | url-status=live }}</ref> which is deducted from income taxes and goes to the individual's respective organization.<ref name="report2014"/> In the past, the ''sóknargjald'' of those who do not belong to any recognized religious organization went to the [[University of Iceland]],<ref>{{cite web | url=https://2009-2017.state.gov/j/drl/rls/irf/2004/35460.htm | title=International Religious Freedom Report for 2004: Iceland | access-date=2015-12-07 | author=Bureau of Democracy, Human Rights and Labor | date=2004 | publisher=[[U.S. Department of State]]}}</ref> but this was changed in 2009.<ref>{{cite web | url=http://www.althingi.is/altext/137/s/0155.html | title=Frumvarp til laga um ráðstafanir í ríkisfjármálum | access-date=2015-12-07 | date=2009 | publisher=[[Althing|Alþingi]] | language=is | archive-url=https://web.archive.org/web/20151208071858/http://www.althingi.is/altext/137/s/0155.html | archive-date=2015-12-08 | url-status=live }}</ref> In cases of individuals not belonging to a registered religious group or secular humanist organization, the amount that would otherwise be used for the ''sóknargjald'' remains now part of the income tax budget. In 2015, the monthly ''sóknargjald'' amounted to 824 [[Icelandic króna|Icelandic krónur]],<ref name="innan"/> about $US6.

=== Italy ===
Italian taxpayers devolve a compulsory 8&nbsp;‰ = 0.8% (eight [[per mil]], i.e. [[eight per thousand]]) from their annual income [[tax]] return to an organised [[religion]] recognised by Italy or, alternatively, to a state-run [[Welfare (financial aid)|social assistance]] scheme.<ref>{{Cite web|url=http://www.governo.it/Presidenza/DICA/2_CONCERTAZIONE_AMMINISTRATIVA_MONITORAGGIO/Servizio_2/ottoxmille/ottopermille.html|title=Italian prime minister's office' explanation of the "otto per mille"}}</ref>

=== Spain ===
The Spanish tax declaration form has one checkbox for the Catholic Church, none for other religious groups and a second checkbox for activities of social interest. These checkboxes don't influence the total tax amount, but, for each ticked checkbox, 0.7% of the total amount are used as indicated. <ref name="Periódico">{{cite web|url=https://www.elperiodico.com/es/economia/declaracion-renta/20220623/dinero-casilla-iglesia-casilla-solidaria-declaracion-renta-13678769|date=2022-06-23|language=es|title=¿Qué hace Hacienda con tu dinero si no marcas la casilla solidaria ni la Iglesia en la declaración de la renta?|access-date=2022-07-31|website=El Periódico}}</ref>

=== Japan ===
In Japan, city residents can choose to allocate a portion of their taxes to their hometowns...aka [[hometown tax]]. In 2021 more than 7 million taxpayers choose to do so resulting in a total allocation of $6 billion ([https://www.weforum.org/agenda/2023/02/japans-hometown-tax-programme-show-challenges-for-the-future-tax-system/ source]).

== See also ==
{{columns-list|colwidth=30em|
* [[Choice architecture]]
* [[Hometown tax]]
* [[Hypothecated tax]]
* [[Microeconomic reform]]
* [[New public management]]
* [[Participatory budgeting]]
* [[Religious Freedom Peace Tax Fund Act]]
* [[Tax reform]]
* [[Voluntary taxation]]
* [[YouCut]]
* ''[[Motivation, Agency, and Public Policy]]''
* ''[[Nudge (book)|Nudge]]''
* ''[[The Other Invisible Hand]]''
}}

== References ==
{{reflist|3}}

== Further reading ==
* Baker, Russell – [https://www.nytimes.com/1990/07/25/opinion/observer-taxpayers-choice.html Taxpayers' Choice] The New York Times. 1990
* Binowski, Brittany – [https://www.forbes.com/sites/brittanybinowski/2012/06/18/how-to-get-americans-to-pay-taxes-willingly/ Why Mandatory Taxes Are Bad – And How The Government Should Fix Them (But Probably Won't)]. Forbes. 18 June 2012
* Blinder, Alan S. – [https://books.google.com/books?id=L2AhEMv7qeoC&dq=voluntary+exchange+theory&pg=PA62 The Economics of Public Finance: Essays] 1989
* Buchanan, James M. – Public Finance in Democratic Process: Fiscal Institutions and Individual Choice 1967
* {{cite journal |last=Buchanan |first=James M. |jstor=1829016 |title=The Economics of Earmarked Taxes |journal=Journal of Political Economy |volume=71 |issue=5 |pages=457–469 |year=1963 |doi=10.1086/258794 |s2cid=153517472 }}	
* Le Grand, Julian - [https://books.google.com/books?id=CAXQMkL0H_8C The Other Invisible Hand: Delivering Public Services through Choice and Competition] 2007

[[Category:Public choice theory]]
[[Category:Political science theories]]
[[Category:Theory of taxation]]
[[Category:Decentralization]]

Pages transcluded onto the current version of this page (help):

Template:Ambox (view source) (template editor protected)
Template:Catalog lookup link (view source) (template editor protected)
Template:Category handler (view source) (protected)
Template:Citation (view source) (protected)
Template:Cite AV media (view source) (template editor protected)
Template:Cite book (view source) (protected)
Template:Cite journal (view source) (protected)
Template:Cite magazine (view source) (protected)
Template:Cite web (view source) (protected)
Template:Clarify (view source) (template editor protected)
Template:Columns-list (view source) (template editor protected)
Template:Delink (view source) (protected)
Template:Div col (view source) (template editor protected)
Template:Div col/styles.css (view source) (template editor protected)
Template:Failed verification (view source) (template editor protected)
Template:Fix (view source) (protected)
Template:Fix-span (view source) (template editor protected)
Template:Fix/category (view source) (protected)
Template:Hlist/styles.css (view source) (protected)
Template:ISBN (view source) (template editor protected)
Template:Main other (view source) (protected)
Template:More footnotes (view source) (template editor protected)
Template:More footnotes needed (view source) (template editor protected)
Template:Page needed (view source) (template editor protected)
Template:Pagetype (view source) (protected)
Template:Portal-inline (view source) (template editor protected)
Template:R (view source) (template editor protected)
Template:R/ref (view source) (template editor protected)
Template:R/superscript (view source) (template editor protected)
Template:R/where (view source) (template editor protected)
Template:Reflist (view source) (protected)
Template:Reflist/styles.css (view source) (protected)
Template:SDcat (view source) (protected)
Template:Sfn (view source) (template editor protected)
Template:Short description (view source) (protected)
Template:Short description/lowercasecheck (view source) (protected)
Template:Sidebar (view source) (template editor protected)
Template:Sidebar with collapsible lists (view source) (template editor protected)
Template:Subinfobox bodystyle (view source) (template editor protected)
Template:Taxation (view source) (semi-protected)
Template:Wrap (view source) (template editor protected)
Template:Yesno (view source) (protected)
Template:Yesno-no (view source) (template editor protected)
Template:Yesno-yes (view source) (template editor protected)
Module:Arguments (view source) (protected)
Module:Catalog lookup link (view source) (template editor protected)
Module:Category handler (view source) (protected)
Module:Category handler/blacklist (view source) (protected)
Module:Category handler/config (view source) (protected)
Module:Category handler/data (view source) (protected)
Module:Category handler/shared (view source) (protected)
Module:Check for unknown parameters (view source) (protected)
Module:Check isxn (view source) (template editor protected)
Module:Citation/CS1 (view source) (protected)
Module:Citation/CS1/COinS (view source) (protected)
Module:Citation/CS1/Configuration (view source) (protected)
Module:Citation/CS1/Date validation (view source) (protected)
Module:Citation/CS1/Identifiers (view source) (protected)
Module:Citation/CS1/Utilities (view source) (protected)
Module:Citation/CS1/Whitelist (view source) (protected)
Module:Citation/CS1/styles.css (view source) (protected)
Module:DecodeEncode (view source) (template editor protected)
Module:Delink (view source) (protected)
Module:Disambiguation/templates (view source) (protected)
Module:Footnotes (view source) (template editor protected)
Module:Footnotes/anchor id list (view source) (template editor protected)
Module:Footnotes/anchor id list/data (view source) (template editor protected)
Module:Footnotes/whitelist (view source) (template editor protected)
Module:GetParameters (view source) (template editor protected)
Module:Message box (view source) (protected)
Module:Message box/ambox.css (view source) (protected)
Module:Message box/configuration (view source) (protected)
Module:Namespace detect/config (view source) (protected)
Module:Namespace detect/data (view source) (protected)
Module:Navbar (view source) (protected)
Module:Navbar/configuration (view source) (protected)
Module:Navbar/styles.css (view source) (protected)
Module:Pagetype (view source) (protected)
Module:Pagetype/config (view source) (protected)
Module:Pagetype/disambiguation (view source) (protected)
Module:Pagetype/rfd (view source) (protected)
Module:Pagetype/setindex (view source) (protected)
Module:Pagetype/softredirect (view source) (protected)
Module:Portal (view source) (template editor protected)
Module:Portal-inline (view source) (template editor protected)
Module:Portal/images/aliases (view source) (template editor protected)
Module:Portal/images/b (view source) (template editor protected)
Module:Portal/images/m (view source) (template editor protected)
Module:SDcat (view source) (protected)
Module:Sidebar (view source) (template editor protected)
Module:Sidebar/configuration (view source) (template editor protected)
Module:Sidebar/styles.css (view source) (template editor protected)
Module:String (view source) (protected)
Module:String2 (view source) (template editor protected)
Module:Template wrapper (view source) (template editor protected)
Module:Unsubst (view source) (protected)
Module:Wikitext Parsing (view source) (protected)
Module:Yesno (view source) (protected)

Return to Tax choice.

Retrieved from "https://en.wikipedia.org/wiki/Tax_choice"