Judge Hong Kong's government by how it treats taxpayers

PUBLISHED : Wednesday, 06 June, 2007, 12:00am
UPDATED : Wednesday, 06 June, 2007, 12:00am

Whether a government is limited, authoritarian, or totalitarian, it is a kleptocracy.

That is, every government maximises the taxes collected by it, for the purpose of possessing and disposing of as much money as possible. Governments everywhere collect unimaginable billions of dollars, pounds, euros, yen and yuan, and covet billions more. The dollar surplus of the Hong kong special administrative region is by design, not by accident.

There are calls in Hong Kong to reduce income-tax rates, but why is a 15-per-cent rate better than a 17-per-cent rate? It is suggested that the lower rate matches spending by the government. If, however, expended money is a 'reason' for a tax rate, then all that the government has to do to justify a higher rate is to spend more money, which is absurd.

To justify any income-tax rate, there has to be a standard of taxation independent of how much money elected self-seekers and their civil-service henchmen want to spend. The only independent standard is the amount of time a taxpayer needs to set aside to fill governmental coffers.

For example, if the income-tax rate is 8 per cent, the amount of tax time imposed on a taxpayer is one month. That arises from simple maths. One month out of 12 is 8.33 per cent of a year.

With that independent standard in mind, the question is, how much tax time, consequent of an income tax, may be imposed by the government?

The answer turns on the relationship between government and the individual. In the context of a limited government, where a man is free, one month of economic subordination of the individual to the government should be expected. If the subordination of the individual is greater than one month, then, with every additional month of economic subordination, he loses more of his 'free man' status. He becomes a serf of government, or, in an extreme case, a slave.

Does Hong Kong have a government of limited scope, an authoritarian government, or a totalitarian government? The answer turns more on the treatment of taxpayers than on the modes of election of the chief executive and of legislators.

Stephen Kruger, Tsim Sha Tsui