I received a photo from a friend welcoming the month of April. Indeed, there is much to be thankful for at the end of March and the beginning of April. March 19, 20 or 21 - depending on the year - is the official beginning of spring. It is the moment when the hours of sunshine are equal to the time of darkness, the vernal equinox, and the start of more daylight. This year the weather at the end of March and the beginning of April in Geneva has been fabulous. Longer sunlight and gorgeous weather have made this year’s end of March a welcome relief from Geneva’s cold, foggy winter. Welcome April!
But one should never forget, can never forget, that the end of March is also the deadline for filing taxes in Switzerland. And for dual Swiss/ American citizens, it is also the time to remember that U.S. tax filing is April 15. (The United States is the only industrial country that taxes its citizens wherever they live, a form of double taxation.) So, while the end of March has so many positive qualities and welcoming April usually a joy, filing taxes looms in the background.
Some thoughts on taxation. Why do we file and pay taxes? Paying taxes has a history as long as civilization has existed. In one form or another, whether it be a percentage of crops or forced labor, people have paid taxes to rulers. There is much truth in the expression that “there is nothing sure in life except death and taxes.”
The American Revolution against Britain was partially fought over taxes. “No taxation without representation” was a key revolutionary rallying cry. And there have been famous acts of tax resistance over government policy. Legend has it that the writer Henry David Thoreau of Walden Pond fame refused to pay taxes in protest of the 1840s U.S. war with Mexico. His famous essay “On Resistance to Civil Government” ends with: “If a thousand men would not pay their tax bills this year, that would not be a violent and bloody measure, as it would be to pay them, and enable the state to commit violence and shed innocent blood.”
Thoreau’s tradition of tax resistance has continued. Various members of groups such as the Quakers have refused to be pay a part of their taxes that they calculate go to supporting violent wars. Nobel Prize winner George Wald and other prominent figures withheld part of their taxes in protest of the Vietnam War in the 1960s, often citing Thoreau’s example.
But we do file and pay taxes, some more than others. While in countries such as Norway citizens know the tax files of members of government, we are all waiting to see Donald Trump’s tax returns. When elected in 2016, Trump refused to reveal his tax declarations, going against a 40-year-old tradition. The New York Times revealed that the self-declared billionaire had paid only $750 in taxes in 2016 and nothing at all in 10 of the previous 15 years. And what about international corporations such as Amazon or Google paying little tax?
We sense that since we all accept that we should pay taxes to keep our governments functioning and have the public service we expect such as schools and roads, there should be some form of proportionality about those who gain the most should pay the most. But laws vary within countries. Both the federal systems in Switzerland and the United States have different cantonal/state laws dealing with taxation and “forfeit” arrangements. This leads to gross differences in places like Zug or Delaware/Montana.
And between countries, we fully recognize that countries can establish their own tax regulations, leading to various tax havens such as in the Caribbean islands.
But my point here is not about the justice of higher or lower taxes or where we live or the places we register our businesses. Governments are spending large sums of money to offset losses due to the pandemic. President Biden, for example, has already gotten a $1.9 trillion relief package passed in Congress and is now proposing a $2 trillion infrastructure bill. The Geneva government is wrestling with increasing the canton’s debt to help those who have suffered financially from the pandemic.
I am in favor of all of the above. My only question is: How will this be paid for? Increasing my taxes? Creating greater debt? Think U.S. Statutory Pay-As-You-Go Act of 2010 which stipulates that the cost of any new legislation must be offset by either cuts elsewhere in the federal budget or increased revenues. Doesn’t that seem reasonable?
The end of March is a call to reality. Filing and paying taxes by responsible citizens are what keeps our governments functioning. We the people are more than just voters.