Taxation through the lens of systemic actualization supports the development of the systems necessary to encourage widespread individual actualization. As explored earlier, taxation exists not as a direct source of funding for government projects but rather as a hedge against the destabilization of a currency through the reduction of supply. There is a significant gap between where we are and where we desire to be. Reimagining our approach to taxation can help close that gap while diminishing the presently uncapped power of the billionaire god-king. All taxation is a form of wealth redistribution, but some methods are more effective than others. The question we explore is how we can leverage these efforts in the context of systemic actualization.
Consider the distribution of advantage in society that our economic systems presently support. The established institutions prioritize the distribution of advantage in favor of those possessing the most, giving legal, economic, and political preference to those owning the means of production within our rigid structures of hierarchy. Governments then attempt to redistribute this advantage via tax and transfer, but these efforts are never enough. Relying primarily on taxation after the fact only serves to further entrench class hierarchies because those with the means inevitably create and leverage loopholes to avoid paying. This approach to redistribution order stifles our available options to address inequity. Politicos and their wealthy companions ensure that the advancement of equitable taxation remains limited to minor moderations of the existing orders. We right wrongs only after they have been significantly abused.
As with much of the crisis, the present arrangements provide few viable alternatives, leading to the idealization of a more radical capture and redistribution of capital at scale. Being able to snap our fingers and reallocate global wealth would be ideal, but in reality, it is unfeasible. Immediate and large-scale redistribution would likely cause more harm than good through the wide-spread destabilization of existing markets. We also lack the legal institutions to enact such an event. Our laws and courts provide absolute favoritism toward those with means. Most importantly, it’s difficult to imagine how the immediate and scaled seizure of assets can occur without violence. When we consider our journey toward self-actualization in the age of crisis and transcendent humanity, we do so through the lens of our core values in alignment with the single truth. If we were to exercise violence to overcome the state and oligarchical monopoly on violence, we would do so against all that we believe and value. Power gained through the threat of violence and coercion may only be maintained by the same methods and would only serve to further entrench hierarchical visions of humanity onto the world. Instead, we direct our focus toward how redistributive taxation may be best leveraged in relation to the original distribution of wealth.
Before we can explore alternatives, we contrast the available tax models of present-day democratic societies. The United States tax structure is one of progress taxation, where percentages of taxes taken increase with individual income. The European tax model is based on consumption through a flat-rate value-added tax (VAT). It’s a goods and services tax calculated by the price of a product or service at each stage of production, distribution, or sale to the end consumer. When considering taxation through the lens of developing and strengthening public works, the most important factor is the total tax. European democracies take at least 10 percent more of gross domestic product (GDP) in the aggregate tax take than the US.9
These countries also invest significant portions of their taxation into redistributive social programs that return significant gains. Despite having the most progressive tax system, the US remains the most inequitable democracy. VAT is technically a more regressive form of taxation, yet it empowers more significant progress. This illustrates why the political focus on increasing progressive income tax rates is misguided, both in its content and character. It’s a convenient scapegoat used by political leaders to avoid focusing on actual systemic change and boils down to a battle about whose class interest is being served. Consider also the flat tax, often touted as the fairest solution. A flat tax system would further entrench the existing elites, as their income far outpaces any percentage that would be equally acceptable to the majority of others. Flat tax seems reasonable in theory but provides no pathways toward systemic actualization.
When we consider the presently available forms of taxation, several available alternatives would be ideal in support of systemic actualization. Nicholas Kaldor developed a tax on individual consumption that functions by taxing the difference between total income (including returns on capital investments) and retained savings (See Figure 7). The difference between these two is what the individual spends on themselves within the year. It is a tax on direct consumption calculated in relation to income and savings, simple but highly effective. Kaldor tax also allows for high degrees of customization or taxation rates on consumption, further empowering our shared alignment with our core value of equity.
We can imagine organizing the scheme so that a percentage of those at the bottom of the economic hierarchy pay nothing while also receiving benefits, whether through direct compensation such as a universal basic income or indirect benefits provided by public works. In the middle, we can have an increasing marginal rate, slowly progressing as income thresholds are crossed. The real power of the Kaldor tax lies in our ability to customize the taxation rates on ultra-elites. There is no ceiling. For example, we might decide that beyond a certain level of combined income and savings, an individual might pay $5.00 for every $1.00 spent. Any income that cannot be demonstrated as saved or invested counts as spent. This application of individual contribution through tax eliminates the loopholes. Like all things within a systemically actualized society, experimentation is key. If the tax is too aggressive too soon, it may pull a significant amount of capital out of circulation. Critics might claim that this taxation model would decrease consumption or disincentivize investment, but it’s a baseless critique. As explored in the crisis of the billionaire god-king, extremely wealthy people cannot consume enough to keep up with their incomes.
Nineteenth-century economist Henry George developed another alternative form of taxation called land value tax. George argued that taxing land value is the most logical source of public revenue because the supply of land is fixed, and public infrastructure improvements would be reflected in (and paid for) by increased land values.10 Land value tax helps tie finance to the real economy by discouraging speculation on land. Compared to property tax, it does not discourage the development, maintenance, or repair of existing structures because there are no taxes on improving what sits on the land. It is considered more equitable11 than present schemes and doesn’t discourage economic activity. The few landholders are the ones responsible for paying the tax. It places a tremendous burden on the rent seeker, a core component of the hierarchical model of society.
Taxation also provides a vehicle to greatly diminish the benefits associated with birth lottery in favor of organizing society around systemic actualization. Taxing inherited wealth is perhaps one of the most contested forms of taxation. We have long been conditioned to believe that building generational wealth is the pinnacle of the human experience. It is a narrative supporting competition as a primary form of human interaction that shirks our responsibilities to others. Dynastic wealth transfer strongly supports birth lottery as the decisive factor of access and agency in the world and stands in stark contrast to the values we adopt in alignment with the single truth and the relational universe. In a society primarily organized around competition and hierarchy, hereditary wealth transfers only further entrench powerful interests and networks. Via a similar methodology used in the Kaldor tax, we apply a variety of scales of taxation based on total assets. Those on the bottom of the economic hierarchy pay nothing, the middle a small bit, and at the very top we apply similar uncapped amounts. Consider also that land is often transferred from parent to child after death, ensuring that Earth’s most valuable resource remains in the hands of the few. In a systemically actualized society, the transfer of inherited wealth plays no role in the individual’s ability to survive. There is no legitimate argument for an individual “deserving” billions because their parents died, especially when the cost is the denial of expansive public works for the many. Hereditary transfer of wealth is one of the greatest sources of inequity in modern society, one that reinforces the specific form of humanity that has led us to the crisis.
There is a popular consensus that taxation is theft. That responsibility to the other is not their burden to bear. This idea is and always has been a fantasy. Humanity has always coexisted. Together, our oneness with the relational universe bonds us as one within the totality of the moment. Taxation is the contribution toward the progress of collective society. So long as we hate taxation, we deny ourselves access to the resources necessary to build what must be built. The idea that humanity would be better served through the elimination of the state misconceptualizes the state. It is a political technology used to infuse a specific form of meaning and value into being. It is no secret that the present political class is corporatist and public monies are spent poorly, but that doesn’t negate the technology itself. We cannot go back to the era of extreme disconnectivity that humanity used to inhabit, and no amount of pretending will make that so. The future is within the decentralized microcommunity, and taxes play a vital role in organizing groups in specific directions. Raising the collective floor is our most direct path toward individual and collective freedom. Taxation as it exists today is ineffective, mismanaged, and ill-aligned with its purpose of serving the public well-being. But this doesn’t exclude it from being a vehicle for significant progress under the appropriate frameworks. Alternatives exist today that could more equitably facilitate the transfer of wealth into the public domain. We just need to implement them, and we cannot do so within the present frameworks of meaning and value or the political, economic, and legal frameworks built upon them. So, we must create new ones in higher alignment with the single truth.