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One would think that the distinction between paying taxes and giving to charity would be obvious. Taxes are compulsory; philanthropy is voluntary. Many taxpayers are oblivious to what they’ve paid in taxes because their taxes are withheld by their employers and remitted directly to the IRS. Philanthropy requires attention; at a minimum, the philanthropist must write a check and forgo the enjoyment of money that was already in his or her bank. And, even small-time donors often spend at least some effort getting to know a charity and volunteering time as well as money.

However, paying taxes and philanthropy have been equated twice in the last week’s news.

The first instance was found in an AP Press story on the Chronicle of Philanthropy’s finding that residents in the southeastern states are typically much more generous donors to charities than residents of New England. The story suggested that Southerners give more because they are more religious than New Englanders. This hypothesis was disputed by Boston College professor Alan Wolfe, who is also a contributing editor to the left-leaning The New Republic:

Alan Wolfe said . . . it’s wrong to link a state’s religious makeup with its generosity.

People in less religious states are giving in a different way by being more willing to pay higher taxes so the government can equitably distribute superior benefits, Wolfe said. And the distribution is based purely on need, rather than religious affiliation or other variables, said Wolfe, also head of the college’s Boisi Center for Religion and Public Life.

Wolfe said people in less religious states “view the tax money they're paying not as something that’s forced upon them, but as a recognition that they belong with everyone else, that they're citizens in the common good. . . . I think people here believe that when they pay their taxes, they’re being altruistic.”

Wolfe’s confidence that technocratic government programs distribute benefits purely according to some objective standard of neediness seems astonishingly naïve -- and he suggests that charities with religious affiliations discriminate, when, for example, many church-based food banks distribute food to all comers.  But, most strikingly, Wolfe suggests that paying high taxes serves in the stead of giving to charity.

The second instance of equating paying taxes and philanthropy was offered by Republican presidential nominee Mitt Romney. As described in a Washington Post story:

During a news conference Thursday [August 16], [Romney] insisted that in the past 10 years, he has not paid a federal income tax rate of less than 13 percent. He made the statement after Senate Majority Leader Harry M. Reid (D-Nev.)said he had been told that Romney had managed to avoid paying federal income taxes for 10 years.

“I think the most recent year is 13.6 or something like that,” Romney said.

Then he continued: “If you add in, in addition, the amount that goes to charity, why the number gets well above 20 percent.”

It wasn’t the first time that Romney had appeared to suggest that it was appropriate to look at his tax and charity payments in total.

“I’m proud of the taxes I pay. My taxes, plus my charitable contributions, this year, 2011, will be about 40 percent,” he said in January during a debate among Republican presidential candidates in Florida.

Given the pressure on Romney to defend against insinuations that he did not pay taxes, it’s understandable that Romney combined his tax rate and charitable giving rate to emphasize that he has not shirked from contributing to the commonweal.

Nevertheless, it’s unfortunate that he appeared to equate taxes and philanthropy. Indiana University professor of philanthropic studies Leslie Lenkowsky was quoted in the Washington Post story that when Romney combines taxes and philanthropy,

It makes him look defensive. . . . He’s mixing apples and oranges. And he ends up with a fruit cocktail.

Equating taxes and philanthropy lends credence to the view that government can spend money at least as well, and probably better, than community-based charities. The view that government knows better than community-based charities has motivated the Obama administration’s repeated efforts to cut the value of the tax deduction for charitable contributions.

Nonprofits and philanthropies have an essential role in American civic life. Defending them requires being clear that paying your taxes isn’t philanthropy.

1 thought on “Paying your taxes isn’t philanthropy”

  1. Scott Allen says:

    Bravo Jacqueline! Thank you for taking time to make this very important point. Paying our taxes does not equal either compassion or generosity. It is not the same as giving sacrifically of time and tresure to help others. Woe to us if we lose all understanding of what compassion and generosity really mean. For more on this, I encourage you and your readers to check out Arthur Brook’s excellent book “Who Really Cares” and Marvin Olasky’s “The Tragedgy of American Compassion.”

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