Most people in America today feel that the federal system of taxation isn't working very well, from the collection techniques to how tax dollars are spent, and even the President and many members of Congress admit that many items in the budget are there just to please various special-interest groups. It's also universally admitted that, despite the high levels of taxation, both the Deficit and the National Debt and growing at an ever- increasing rate.

To reduce this problem, President Ronald Reagan created a commission to study government waste entitled: The President's Private-Sector Survey On Cost Control [original copy at], popularly known as the "Grace Commission," named after its chairman, J. Peter Grace.

In his opening letter to the President in volume one of the report, Chairman Grace revealed that

"...all individual income tax revenues are gone before one nickel is spent on the services which taxpayers expect from their Government."

This comes as a great shock to many, but the truth of the matter is that IRS taxes as we known them today were NEVER intended to pay for any government services.

The concept of the withholding tax was invented during the World War II-era by Beardsley Ruml, who at the time was the Chairman of the Federal Reserve Bank of New York. To explain the new tax, and its purposes, Chairman Ruml wrote an article which appeared in the January 1946 issue of "American Affairs." Appropriately enough, the article was entitled, "Taxes For Revenue Are Obsolete."

In summarizing the points of his article, the editors of "American Affairs" wrote,

"...a sovereign national government is finally free of money worries and need no longer levy taxes for the purpose of providing itself with revenue."

Chairman Ruml himself does admit though that

"...a century and a half ago, the national government required revenues in order to pay its bills."

So taxes aren't needed for running the federal government anymore. This leaves many asking, "Why does the government take so much of what I earn?"

Chairman Ruml, under the heading "What Taxes Are Really For," gave the following answers:

"Federal taxes can be made to service four principle purposes of a social and economic character. These purposes are:

1). As an instrument of fiscal policy to help stabilize the purchasing power of the dollar;

2). To express public policy in the distribution of wealth and of income, as in the case of the progressive income and estate taxes;

3). To express public policy in subsidizing or in penalizing various industries and economic groups;

4). To isolate and assess directly the costs of certain national benefits, such as highways and social security.

In the recent past, we have used our federal tax program consciously for each of these purposes. In serving these purposes, the tax program is a means to an end.

To summarize, here is what IRS taxes are and ARE NOT used for:

  1. They are used to help implement economic policies designed by the federal government,

  2. They are used for social purposes (who should, and should not, in the opinion of congress, have such-and-such amount of money), and

  3. They are used to subsidize various groups and interests, such as private banks, but

  4. They are not used to pay for any government services.

This means that if all IRS tax laws were repealed tomorrow, there would be no effect on government services. The only thing that would change is that the federal government won't be able to exert the social and economic control that it currently does.

There are more and more people saying that we'd be better off without the regulated economy we currently have. Certainly having the federal government involved in every aspect of the economy was something never contemplated by the framers of the Federal Constitution.

Among those who've said that our federal tax system doesn't work is T. Coleman Andrews, who actually served as the Commissioner of Internal Revenue back in the 1950's. After he left office, he began to speak out against what he perceived as being "rapacious tax enactments." In an article he wrote for the April 22, 1956 issue of "The American Weekly," he shared these reflections:

"As Commissioner of Internal Revenue I often thought how far we had gone toward coming ourselves "through excessive and unjust taxation. We have failed to realize, it seems to me, that through our tax system we have been playing right into the hands of the Marxists, who gleefully hail the income tax as the one sure instrument that will bring capitalism to its knees."

On this point, it's interesting to note that a graduated income tax is one of the planks of "The Communist Manifesto." He also explained how special-interest groups have exempted themselves from taxation, and that the true targets of IRS tax laws are the middle class:

"Whether you believe it or not, everybody is being overtaxed and the middle class is being taxed out of existence, and the nation, thereby, is being robbed of its surest guarantee of continued sound economic development and growth and its staunchest bulwark against the ascendancy of socialism."

Almost every American, whether he's interested in current affairs or not, believes that taxes are simply too high. Some justify this to themselves by saying that IRS taxes are absolutely necessary to pay for needed government services, and that everyone is paying just as much as they are. These arguments would undoubtedly disappear if more people knew that IRS taxes are specifically targeted on the middle-class and don't pay for any government services.

This is where Sovereign Citizenship comes in. As a Citizen, most IRS tax laws simply won't apply to you. You won't have to hope that Congress "gives you a break." You won't have to change the tide of public opinion to keep what you earn. You'll simply use the law, as it's written, to your advantage, instead of allowing it to be used advantageously against you. It's perfectly alright to do this. Even the federal courts approve:

"Any one may so arrange his affairs that his taxes shall be as low as possible; he is not bound to choose that pattern which will best pay the Treasury; there is not even a patriotic duty to increase one's taxes." Helvering v. Gregory, Federal Reporter, 2nd series, Vol. 69, Page 810 (1934)

There's no patriotic duty to pay a lot in taxes. But isn't there a duty to yourself and your loved ones to reduce your costs, while justly supporting your community with your increased purchasing power? Isn't it time you actually did something about this?

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