Let’s say you have a friend who owes somebody some money. Your friend’s lender holds a gun to your head and tells you that either you collect the debt for him or you must pay it yourself. If not, then maybe he will pull the trigger.
Generally, as a society, we would call this situation (slightly exaggerated as it may be) a heinous use of force. Yet, this is the position all businesses in the United
States must endure as their privilege for being an employer and for selling items to the public. Whether they like it or not, employers are required to be unpaid tax collectors and must collect these taxes or go to prison, have their assets possessed, and other serious consequences.
When I opened a business, I did not willingly sign up to be a federal employee without pay. Nor a state employee without pay. Yet, if I want to exercise my rights to operate within what is supposed to be a free enterprise system to (hopefully) create wealth and prosperity for everyone, then I am required to be drafted into the army of tax collectors. I must collect sales tax, state withholding taxes, federal withholding taxes, and social security taxes (part of which I am taxed to pay but really for all practical terms is additional income tax for my employees).
So, is this incredibly difficult to do the work involved with collecting these taxes? Not really. In my case, I could account for them and pay them myself with a little help form expensive computer software. However, I choose to pay someone else to do it for me. But, it isn’t really about how difficult it is to collect and remand these taxes. it is more about whether a person should be forcibly drafted into collecting them , and whether they should do so without compensation. If a business owner is forced to collect taxes from his employees and customers, then it logically follows that there is nothing to prevent government officials from forcing you to collect taxes from your neighbors, without compensation and without choice in the matter.
Is it fair to force a business to be in an antagonistic position with its employees? Libertarians argue that government should stay out of how we manage our relationships. is it fair to force a business to host an antagonistic relationship with its customers? It seems so anti-free enterprise, and so anti-capitalist.
The two alternatives to income tax that are most cited are a consumption tax (i.e. a national sales tax) and a “fair tax” (or flat tax). Most people envision businesses having responsibility for collecting either of these taxes. However, if businesses are to collect the taxes, government is then encroaching onto a business’ right to manage its own affairs, to make its own contracts for conducting business as it pleases (within reason), to manage its own relationships with moth its employees and its customers.
Businesses should have these same rights as do all of us as individuals. When any person or any business is coerced by force into activities not desired, even if those activities are collecting taxes, then society suffers. It is wrong to force people into jobs without being paid (or to force them into a job at all). We usually call that slavery. Perhaps, there can be a better solution to collect taxes. Perhaps the government can somehow collect its own taxes and leave people like me out of it.
* Danny Chabino, has owned his own business for 20 years. He has been a proud employer and operator of a small retail business for 16 years.