Taxes

Taxes

A tax is money that people and businesses must pay to the government. Scripture teaches that governing authorities have a legitimate right to collect taxes. Jesus commanded, “Render to Caesar the things that are Caesar’s, and to God the things that are God’s” (Matthew 22:21, ESV). The apostle Paul also affirmed this principle: “For because of this you also pay taxes, for the authorities are ministers of God, attending to this very thing” (Romans 13:6–7, ESV).1

Biblical Support for Taxation

The right of government to collect taxes has clear biblical support. Wayne Grudem notes that taxation serves necessary purposes, such as funding essential government responsibilities and providing basic care for the poor. He distinguishes this from using taxes to seek general redistribution of wealth, explaining that the Bible does not support taxation for that purpose but does affirm it for legitimate governmental roles, including limited welfare functions.2

Effects of Taxation

Personal Freedom

Rising tax rates can reduce personal freedom by limiting how individuals choose to use their own resources. Every dollar collected by the state is one that cannot be directed by the individual toward family needs, charitable giving, or other purposes. Grudem illustrates that as taxes increase, a “small portion of everyone’s life” is transferred from private stewardship to government control, restricting liberty.3

Business Impact

High corporate taxes influence the entire economy. When business taxes increase, companies often pass those additional costs along to consumers through higher prices. This creates what Grudem calls an “invisible tax,” where the burden ultimately falls on ordinary citizens. He argues that lower corporate tax rates foster economic growth, increase competitiveness, and ultimately yield greater revenue as businesses expand and hire more workers.4

Tax Policy Principles

Broad Participation

Sound tax policy allows all income earners to contribute at least a small share. This broad participation fosters accountability because everyone has a personal stake in how public funds are used. Grudem points out that even in ancient Israel’s law, differing sacrifices were allowed based on economic ability, yet everyone contributed in some measure (see Leviticus 12:8). He concludes that when citizens at all income levels pay some tax, governments become more accountable to those they serve.5

References

  1. Wayne A. Grudem, Politics - According to the Bible: A Comprehensive Resource for Understanding Modern Political Issues in Light of Scripture (Grand Rapids: Zondervan, 2010), 285.

  2. Grudem, Politics - According to the Bible, 285–286.

  3. Ibid., 289–290.

  4. Ibid., 295.