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Taxation & Fiscal Responsibility
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Taxation is an appropriation of
the property of free citizens, therefore it is vitally important that it be under the
oversight of the people themselves in a free society. For this reason, that house of the
legislature that is closest to the people and subject most often to their approval at the
polls is the house that properly originates tax measures. Particulars on government
expenditures and taxation should be plain and available to all if the oversight by the
people is to be effective.
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"I like the power given the
Legislature to levy taxes, and for that reason solely approve of the greater house being
chosen by the people directly. For though I think a house chosen by them will be very illy
qualified to legislate for the Union, for foreign nations, etc., yet this evil does not
weigh against the good of preserving inviolate the fundamental principle that the people
are not to be taxed but by representatives chosen immediately by themselves."
--Thomas Jefferson to James Madison, 1787. ME 6:387
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"As to the new
Constitution... Would it not have been better to assign to Congress exclusively the
article of imposts for federal purposes, and to have left direct taxation exclusively to
the States? I should suppose the former fund sufficient for all probably events, aided by
the land office." --Thomas Jefferson to Edward Carrington, 1787. ME 6:395
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"Many of the opposition [to
the new Federal Constitution] wish to take from Congress the power of internal taxation.
Calculation has convinced me that this would be very mischievous." --Thomas Jefferson
to William Carmichael, 1788. ME 7:248
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"I approved from the first
moment of... the power of taxation [in the new Constitution]. I thought at first that [it]
might have been limited. A little reflection soon convinced me it ought not to be."
--Thomas Jefferson to Francis Hopkinson, 1789. ME 7:300
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"Calculation has convinced
me that circumstances may arise and probably will arise wherein all the resources of
taxation will be necessary for the safety of the state. For though I am decidedly of
opinion we should take no part in European quarrels, but cultivate peace and commerce with
all, yet who can avoid seeing the source of war in the tyranny of those nations who
deprive us of the natural right of trading with our neighbors?... War requires every
resource of taxation and credit." --Thomas Jefferson to George Washington, 1788. ME
7:224
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"Taxation is, in fact, the
most difficult function of government and that against which their citizens are most apt
to be refractory. The general aim is, therefore, to adopt the mode most consonant with the
circumstances and sentiments of the country." --Thomas Jefferson: Introduction to
Tracy's "Political Economy," 1816. ME 14:460
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"The suppression of
unnecessary offices, of useless establishments and expenses enabled us to discontinue
internal taxes. These covering our land with officers and opening our doors to their
intrusions, had already begun that process of domiciliary vexation which, once entered, is
scarcely to be restrained from reaching successively every article of produce and
property." --Thomas Jefferson: 2nd Inaugural, 1805. ME 3:376
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"[Montesquieu wrote in
Spirit
of the Laws,
XIII,c.14:] 'A capitation is more natural to slavery; a duty on
merchandise is more natural to liberty, by reason it has not so direct a relation to the
person.'" --Thomas Jefferson: copied into his Commonplace Book.
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"Our properties within our
own territories [should not] be taxed or regulated by any power on earth but our
own." --Thomas Jefferson: Rights of British America, 1774. (*) ME 1:210, Papers 1:135
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"Is it consistent with good
policy or free government to establish a perpetual revenue? Is it not against the practice
of our wise British ancestors? Have not instances in which we have departed from this in
Virginia been constantly condemned by the universal voice of our country? Is it safe to
make the governing power when once seated in office, independent in its revenue? Should we
not have in contemplation and prepare for an event (however deprecated) which may happen
in the possibility of things; I mean a re-acknowledgment of the British tyrant as our
king, and previously strip him of every prejudicial possession? Remember how universally
the people run into the idea of recalling Charles the 2d after living many years under a
republican government." --Thomas Jefferson to Edmund Pendleton, 1776. ME 4:276,
Papers 1:492
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"Taxes should be
proportioned to what may be annually spared by the individual." --Thomas Jefferson to
James Madison, 1784. FE 4:15, Papers 7:557
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"[Montesquieu wrote in
Spirit
of the Laws,
XIII, c.1:] 'The public revenues are a portion that each subject gives of
his property in order to secure or enjoy the remainder. To fix their revenues in a proper
manner, regard should be had both to the necessities of the state and to those of the
subject. The real wants of the people ought never to give way to the imaginary wants of
the state.'" --Thomas Jefferson: copied into his Commonplace Book.
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"Another means of silently
lessening the inequality of property is to exempt all from taxation below a certain point,
and to tax the higher portions of property in geometrical progression as they rise."
--Thomas Jefferson to James Madison, 1785. ME 19:18, Papers 8:682
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"Whether property alone, and
the whole of what each citizen possesses, shall be subject to contribution, or only its
surplus after satisfying his first wants, or whether the faculties of body and mind shall
contribute also from their annual earnings, is a question to be decided. But when decided,
and the principle settled, it is to be equally and fairly applied to all." --Thomas
Jefferson: Note to Destutt de Tracy's "Political Economy," 1816. ME 14:466
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"The simplest system of
taxation yet adopted is that of levying on the land and the laborer. But it would be
better to levy the same sums on the produce of that labor when collected in the barn of
the farmer; because then if through the badness of the year he made little, he would pay
little. It would be better yet to levy it only on the surplus of this produce above his
own wants. It would be better, too, to levy it, not in his hands, but in those of the
purchaser; because though the farmer would in fact pay it, as the purchaser must deduct it
from the original price of his produce yet the farmer would not be sensible that he paid
it... What a comfort to the farmer to be allowed to supply his own wants before he should
be liable to pay anything, and then to pay only out of his surplus." --Thomas
Jefferson to James Madison, 1784. Papers 7:558
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"The public contributions
should be as uniform as practicable from year to year, that our habits of industry and of
expense may become adapted to them; and that they may be duly digested and incorporated
with our annual economy." --Thomas Jefferson to John Wayles Eppes, 1813. FE 9:398
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"Would it not be better to
simplify the system of taxation rather than to spread it over such a variety of subjects
and pass the money through so many new hands?" --Thomas Jefferson to James Madison,
1784. Papers 7:557
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"The government which steps
out of the ranks of the ordinary articles of consumption to select and lay under
disproportionate burdens a particular one because it is a comfort, pleasing to the taste
or necessary to the health and will therefore be bought, is in that particular a tyranny.
Taxes on consumption like those on capital or income, to be just, must be uniform."
--Thomas Jefferson to Samuel Smith, 1823. ME 15:432
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"A tariff bill... is
considered as a levy on the labors and efforts of the other classes of industry to support
that of manufacturers." --Thomas Jefferson to Richard Rush, 1824. FE 10:304
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"[If] none of [a certain
article] are [manufactured] here... the duty on them becomes consequently not a
protecting, but really a prohibitory one." --Thomas Jefferson to -----, 1821. (*) ME
15:338
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"The taxes with which we are
familiar class themselves readily according to the basis on which they rest. 1. Capital.
2. Income. 3. Consumption. These may be considered as commensurate; Consumption being
generally equal to Income, and Income the annual profit of Capital. A government may
select either of these bases for the establishment of its system of taxation, and so frame
it as to reach the faculties of every member of the society, and to draw from him his
equal proportion of the public contributions; and, if this be correctly obtained, it is
the perfection of the function of taxation. But when once a government has assumed its
basis, to select and tax special articles from either of the other classes, is double
taxation. For example, if the system be established on the basis of Income, and his just
proportion on that scale has been already drawn from every one, to step into the field of
Consumption and tax special articles in that, as broadcloth or homespun, wine or whiskey,
a coach or a wagon, is doubly taxing the same article. For that portion of Income with
which these articles are purchased, having already paid its tax as Income, to pay another
tax on the thing it purchased, is paying twice for the same thing; it is an aggrievance on
the citizens who use these articles in exoneration of those who do not, contrary to the
most sacred of the duties of a government, to do equal and impartial justice to all its
citizens." --Thomas Jefferson: Note to Destutt de Tracy's "Political
Economy," 1816. ME 14:464
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"How far it may be the
interest and the duty of all to submit to this sacrifice [of paying a double taxation on
special articles] on other grounds, for instance, to pay for a time an impost on the
importation of certain articles in order to encourage their manufacture at home, or an
excise on others injurious to the morals or health of the citizens, will depend on a
series of considerations of another order." --Thomas Jefferson: Note to Destutt de
Tracy's "Political Economy," 1816. ME 14:465
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"It must be observed that
our revenues are raised almost wholly on imported goods." --Thomas Jefferson to
Gouverneur Morris, 1793. ME 9:198
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"Revenue on the consumption
of foreign articles is paid cheerfully by those who can afford to add foreign luxuries to
domestic comforts... These contributions enable us to support the current expenses of the
government, to fulfil contracts with foreign nations, to extinguish the native right of
soil within our limits, to extend those limits, and to apply such a surplus to our public
debts, as places at a short day their final redemption. And that redemption once effected,
the revenue thereby liberated may, by a just repartition among the states and a
corresponding amendment of the Constitution, be applied in time of peace to rivers,
canals, roads, arts, manufactures, education, and other great objects within each state.
In
time of war,
if injustice by ourselves or others must sometimes produce war, increased
as the same revenue will be increased by population and consumption and aided by other
resources reserved for that crisis, it may meet within the year all the expenses of the
year without encroaching on the rights of future generations by burdening them with the
debts of the past. War will then be but a suspension of useful works, and a return to a
state of peace, a return to the progress of improvement." -Thomas Jefferson: 2nd
Inaugural, 1805. ME 3:376
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"Instead of taxes for the
whole year's expenses [of a war], which the people cannot pay, a tax to the amount of the
interest and a reasonable portion of the principal will command the whole sum, and throw a
part of the burdens of war on times of peace and prosperity." --Thomas Jefferson to
William Short, 1814. ME 14:217
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"The collection of taxes...
has been as yet only by duties on consumption. As these fall principally on the rich, it
is a general desire to make them contribute the whole money we want, if possible. And we
have a hope that they will furnish enough for the expenses of government and the interest
of our whole public debt, foreign and domestic." --Thomas Jefferson to Comte de
Moustier, 1790. ME 8:110
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"The rich alone use imported
articles, and on these alone the whole taxes of the General Government are levied. ... Our
revenues liberated by the discharge of the public debt, and its surplus applied to canals,
roads, schools, etc., the farmer will see his government supported, his children educated,
and the face of his country made a paradise by the contributions of the rich alone,
without his being called on to spend a cent from his earnings." --Thomas Jefferson to
Thaddeus Kosciusko, 1811. ME 13:41
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"The great mass of the
articles on which impost is paid is foreign luxuries, purchased by those only who are rich
enough to afford themselves the use of them. Their patriotism would certainly prefer its
continuance and application to the great purposes of the public education, roads, rivers,
canals, and such other objects of public improvement as it may be thought proper to add to
the constitutional enumeration of federal powers." --Thomas Jefferson: 6th Annual
Message, 1806. ME 3:423
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"We are all the more
reconciled to the tax on importations, because it falls exclusively on the rich, and with
the equal partition of intestate's estates, constitutes the best agrarian law. In fact,
the poor man in this country who uses nothing but what is made within his own farm or
family, or within the United States, pays not a farthing of tax to the General Government,
but on his salt; and should we go into that manufacture as we ought to do, he will pay not
one cent." --Thomas Jefferson to Pierre Samuel Dupont de Nemours, 1811. ME 13:39
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"I rejoice, as a moralist,
at the prospect of a reduction of the duties on wine by our national legislature. It is an
error to view a tax on that liquor as merely a tax on the rich. It is a prohibition of its
use to the middling class of our citizens, and a condemnation of them to the poison of
whiskey, which is desolating their houses. No nation is drunken where wine is cheap; and
none sober, where the dearness of wine substitutes ardent spirits as the common beverage.
It is, in truth, the only antidote to the bane of whiskey. Fix but the duty at the rate of
other merchandise, and we can drink wine here as cheap as we do grog; and who will not
prefer it? Its extended use will carry health and comfort to a much enlarged circle.
Everyone in easy circumstances (as the bulk of our citizens are) will prefer it to the
poison to which they are now driven by their government. And the treasury itself will find
that a penny apiece from a dozen, is more than a groat from a single one." --Thomas
Jefferson to Jean Guillaume Hyde de Neuville, 1818. ME 15:178
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"A tax on whiskey is to
discourage its consumption; a tax on foreign spirits encourages whiskey by removing its
rival from competition... Foreign spirits, wines, teas, coffee, segars, salt, are articles
of as innocent consumption as broadcloths and silks; and ought, like them, to pay but the
average ad valorem duty of other imported comforts. All of them are ingredients in
our happiness." --Thomas Jefferson to Samuel Smith, 1823. ME 15:432
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"The excise law is an
infernal one. The first error was to admit it by the Constitution; the second, to act on
that admission; the third and last will be, to make it the instrument of dismembering the
Union, and setting us all afloat to choose what part of it we will adhere to."
--Thomas Jefferson to James Madison, 1794. ME 9:295
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The Restraints on Taxation |
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"The privilege of giving or
withholding our moneys is an important barrier against the undue exertion of prerogative
which if left altogether without control may be exercised to our great oppression; and all
history shows how efficacious its intercession for redress of grievances and
reestablishment of rights, and how improvident would be the surrender of so powerful a
mediator." --Thomas Jefferson: Reply to Lord North, 1775. Papers 1:225
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"The purse of the people is
the real seat of sensibility. It is to be drawn upon largely, and they will then listen to
truths which could not excite them through any other organ." --Thomas Jefferson to A.
H. Rowan, 1798. ME 10:60
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"Excessive taxation ... will
carry reason and reflection to every man's door, and particularly in the hour of
election." --Thomas Jefferson to John Taylor, 1798. ME 10:64
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"Bitter men are not pleased
with the suppression of taxes. Not daring to condemn the measure, they attack the motive;
and too disingenuous to ascribe it to the honest one of freeing our citizens from
unnecessary burthens and unnecessary systems of office, they ascribe it to a desire of
popularity." --Thomas Jefferson to Benjamin Rush, 1801. ME 10:304
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"Our citizens may be
deceived for awhile and have been deceived; but... we may trust to... the tax-gatherers
[for light]; for it is not worth the while of our anti-republicans to risk themselves on
any change of government but a very expensive one. Reduce every department to
economy, and there will be no temptation to them to betray their constituents."
--Thomas Jefferson to Archibald Stuart, 1799. FE 7:378
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"Private fortunes are
destroyed by public as well as by private extravagance. And this is the tendency of all
human governments." --Thomas Jefferson to Samuel Kercheval, 1816. ME 15:40
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"Sound principles will not
justify our taxing the industry of our fellow citizens to accumulate treasure for wars to
happen we know not when and which might not perhaps happen but from the temptations
offered by that treasure." --Thomas Jefferson: 1st Inaugural, 1801. ME 3:331
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Reducing Government Expenses |
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"The multiplication of
public offices, increase of expense beyond income, growth and entailment of a public debt,
are indications soliciting the employment of the pruning knife." --Thomas Jefferson
to Spencer Roane, 1821. ME 15:325
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"We are endeavoring... to
reduce the government to the practice of a rigorous economy, to avoid burthening the
people and arming the magistrate with a patronage of money, which might be used to corrupt
and undermine the principles of government." --Thomas Jefferson to Mr. Pictet, 1803.
ME 10:356
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"A rigid economy of the
public contributions and absolute interdiction of all useless expenses will go far towards
keeping the government honest and unoppressive." --Thomas Jefferson to Lafayette,
1823. ME 15:491
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"Economy in the public
expense, that labor may be lightly burdened, I deem [one of] the essential principles of
our government, and consequently [one of] those which ought to shape its
administration." --Thomas Jefferson: 1st Inaugural Address, 1801. ME 3:322
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"Considering the general
tendency to multiply offices and dependencies and to increase expense to the ultimate term
of burden which the citizen can bear, it behooves us to avail ourselves of every occasion
which presents itself for taking off the surcharge; that it may never be seen here that,
after leaving to labor the smallest portion of its earnings on which it can subsist,
government shall itself consume the residue of what it was instituted to guard."
--Thomas Jefferson: 1st Annual Message, 1801. ME 3:333
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"Taxes should be continued
by annual or biennial reenactments, because a constant hold by the nation of the strings
of the public purse is a salutary restraint from which an honest government ought not to
wish, nor a corrupt one to be permitted to be free." --Thomas Jefferson to John
Wayles Eppes, 1813. ME 13:354
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"When merely by avoiding
false objects of expense we are able, without a direct tax, without internal taxes, and
without borrowing, to make large and effectual payments toward the discharge of our public
debt and the emancipation of our posterity from that moral canker, it is an encouragement,
fellow citizens, of the highest order, to proceed as we have begun, in substituting
economy for taxation, and in pursuing what is useful for a nation placed as we are, rather
than what is practiced by others under different circumstances. And whensoever we are
destined to meet events which shall call forth all the energies of our countrymen, we have
the firmest reliance on those energies, and the comfort of leaving for calls like these
the extraordinary resources of loans and internal taxes." --Thomas Jefferson: 2nd
Annual Message, 1802. ME 3:345
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"No tax should ever be
yielded for a longer term than that of the Congress wanting it except when pledged for the
reimbursement of a loan." --Thomas Jefferson to John Wayles Eppes, 1813. ME 13:355
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"I hope a tax will be
preferred [to a loan which threatens to saddle us with a perpetual debt], because it will
awaken the attention of the people and make reformation and economy the principle of the
next election. The frequent recurrence of this chastening operation can alone restrain the
propensity of governments to enlarge expense beyond income." --Thomas Jefferson to
Albert Gallatin, 1820.
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"I am for a government
rigorously frugal and simple, applying all the possible savings of the public revenue to
the discharge of the national debt; and not for a multiplication of officers and salaries
merely to make partisans, and for increasing by every device the public debt on the
principle of its being a public blessing." --Thomas Jefferson to Elbridge Gerry,
1799. ME 10:77
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"As the doctrine is that a
public debt is a public blessing, so [the chickens of the treasury] think a perpetual one
is a perpetual blessing, and therefore wish to make it so large that we can never pay it
off." --Thomas Jefferson to Nicholas Lewis, 1792. ME 8:325
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"It is our principle to pay
to a moment whatever we have engaged, and never to engage what we cannot, and mean not
faithfully to pay." --Thomas Jefferson to Pierre Samuel Dupont de Nemours, 1803. ME
10:349
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Government's Financial
Responsibility
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"Having seen the people of
all other nations bowed down to the earth under the wars and prodigalities of their
rulers, I have cherished their opposites: peace, economy, and riddance of public debt,
believing that these were the high road to public as well as private prosperity and
happiness." --Thomas Jefferson to Henry Middleton, 1813. ME 13:202
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"To reform the prodigalities
of our predecessors is understood to be peculiarly our duty, and to bring the government
to a simple and economical course." --Thomas Jefferson to James Monroe, 1803. ME
10:345
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"To preserve the faith of
the nation by an exact discharge of its debts and contracts, expend the public money with
the same care and economy we would practice with our own, and impose on our citizens no
unnecessary burden... are the landmarks by which we are to guide ourselves in all our
proceedings." --Thomas Jefferson: 2nd Annual Message, 1802. ME 3:348
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"That all should be
satisfied with any one order of things is not to be expected, but I indulge the pleasing
persuasion that the great body of our citizens will concur in honest and disinterested
efforts which have for their object... to reduce expenses to what is necessary for the
useful purposes of government." --Thomas Jefferson: 1st Annual Message, 1801. ME
3:339
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"I... place economy among
the first and most important of republican virtues, and public debt as the greatest of the
dangers to be feared." --Thomas Jefferson to William Plumer, 1816. ME 15:46
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"I think it an object of
great importance... to simplify our system of finance and bring it within the
comprehension of every member of Congress." --Thomas Jefferson to Albert Gallatin,
1802. ME 10:306
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"The accounts of the United
States ought to be and may be made as simple as those of a common farmer and capable of
being understood by common farmers." --Thomas Jefferson to James Madison, 1796. ME
9:324
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"We might hope to see the
finances of the Union as clear and intelligible as a merchant's books, so that every
member of Congress and every man of any mind in the Union should be able to comprehend
them, to investigate abuses, and consequently to control them. Our predecessors have
endeavored by intricacies of system and shuffling the investigation over from one office
to another, to cover everything from detection. I hope we shall go in the contrary
direction, and that, by our honest and judicious reformation, we may be able... to bring
things back to that simple and intelligible system on which they should have been
organized at first." --Thomas Jefferson to Albert Gallatin, 1802. (*) ME 10:307
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"The same prudence which in
private life would forbid our paying our money for unexplained projects forbids it in the
disposition of the public moneys." --Thomas Jefferson to Shelton Gilliam, 1808. ME
12:73
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"I do not know on what
principles of reasoning it is that good men think the public ought to pay more for a thing
than they would themselves if they wanted it." --Thomas Jefferson to Henry Dearborn,
1808. ME 12:61
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"All the purposes for which
[the government] can pay a single dollar are specified by law." --Thomas Jefferson to
Joel Barlow, 1808. ME 12:216
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"For expenses which it is
impossible for us to scrutinize or control,... our laws oppose the application of public
money so informally." --Thomas Jefferson to Thomas Barclay, 1791. ME 8:201
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"In our care of the public
contributions intrusted to our direction, it would be prudent to multiply barriers against
their dissipation by appropriating specific sums to every specific purpose susceptible of
definition; by disallowing applications of money varying from the appropriation in object
or transcending it in amount; by reducing the undefined field of contingencies and thereby
circumscribing discretionary powers over money; and by bringing back to a single
department all accountabilities for money where the examination may be prompt, efficacious
and uniform." --Thomas Jefferson: 1st Annual Message, 1801. ME 3:333
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ME, FE = Memorial Edition, Ford Edition. |
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