LIFE | MONEY | BUSINESS | SLAVERY | ENTREPRENEURSHIP
How to Escape From Modern Slavery: The Taxed Life
A story about taxes, a call to stop being naïve
“Taxes are the chains of the slaves, money the substance of their work, and governments the masters that rob them.”
Baruch.
Taxes Are the Chain of Modern Slavery
There is plenty of wisdom in old sayings. One such example says that there are only two things certain in a man’s life: death and paying taxes.
As chameleons can change their color for camouflage, so do taxes with their names (and for the same purpose): tax, tribute, excise duty, levy, toll, charge, contribution, fee, etc. However, they are all the same. The RAE dictionary defines tax as: “A tribute required according to the economic capacity of those obliged to pay.”
Who requires the payment of the tribute? No other than the government. So, the definition depicts a relationship where the government demands the tribute, and the subjects are obliged to pay it.
Indeed, the tribute can only be demanded if the government has the coercive means to force the other parties to comply with its payment. That is if the government has “power” (or authority, both of which it undoubtedly has).
Many governments have significantly distorted the use of taxes, making them a heavy burden on the citizens they should care for. In reality, taxes have become a new form of slavery.
The Illusion of Earning Money for Your Work
Some may argue that we cannot talk about the existence of widespread modern slavery since, in a slave system of production, slaves don’t receive payment for their work. They only get the bare minimum of foods and clothes necessary to continue working, which is not the case in our times. Let’s take a look at that through the life of a hypothetical “Peter.”
I’m sure you know how the tax system works in many modern countries and states: we can say that it begins before an individual is born.
When Peter’s parents bought him a crib, diapers, bottles, clothes, etc., they paid a Sales Tax: 27% in Hungary, 25% in Denmark, or 19% in Colombia. In Puerto Rico, it’s called “Sales and Use Tax” (yes, you read that correctly).
Then, throughout his life, and with this one tax alone, Peter is milked with 20% of “his” money on everything he buys.
Now, a person with a low or minimum income will spend monthly the same amount of money they earn. This means that, effectively, a fourth or fifth of Peter’s life, so to speak, will be taken away from him with this tax alone. That will happen every time he buys gas, electricity, water, food, or clothing.
When he reaches the age when he starts working (and earning money), he will have to pay Income Tax (or Profit Tax). It can be as high as 57% if he is fortunate enough to live under the care of the Swedish government.
Now, If Peter is an entrepreneur, then the company that he establishes, and with which he will provide goods, services, and jobs, must also pay tax. It’s called Corporate Tax.
When the time comes for his company to distribute dividends to him and his partners, they will also have to pay tax on them.
Together, both taxes can represent as much as 57% if he has the privilege of living in Ireland, South Korea, Canada, France, or Denmark (54.8–57.1%)
The Government Is Your Master
With his first salary slip, Peter discovers that he will not only have to pay Income Tax. He’ll also have to contribute to his country’s health and social security systems. If he is an entrepreneur, his company must also contribute “in favor” of its workers and employees.
I used scare quotes since the contributions do not go to a bank account in the name of those workers. The money goes to a huge pot managed by the government, or to “Funds” privately administered by fund managers that wisely invest in (scare quotes again) “Triple-A” instruments.
The Spanish case evinces the truth:
In 2011, a former Spanish president named José Luis Rodríguez Zapatero left the pension box (“piggy bank” as they call it there) with 66.814 billion euros. In just three years, the government of the new boss, Mariano Rajoy, reduced it to 39.52 billion, that is, it took out 27.294 billion euros. By January 2020, the remaining money in the savings pig was barely € 1.5 billion. At this rate, it will not take long for the piggy bank to be emptied and left at Є 0.00.
With nine consecutive years of accumulated deficits, the Spanish Government has almost entirely emptied the Reserve Fund. This fact highlights the Ponzi nature (Ponzi scam) of the social security systems and the pension system, standard in nearly all countries.
The depriving of millions of Spanish retirees of their livelihood is only a matter of time.
But the socialist voracity did not stop there, as by December 2014 it had also used the surpluses from the management of the occupational accidents mutual insurance companies: € 5.35 billion.
The example of the Spanish security system can be transferred to many countries and illustrates the enormous inefficiency of their governments.
Milking the Slave From Birth to Death, And Even Beyond, Literally
With hard work, Peter will have managed to buy and pay for a house or apartment, only to find that, in fact, it doesn’t belong to him.
Indeed, a person should not forget that “their” house, land, or apartment, fully paid for, does not really belong to them: look at what happens if they stop paying their property taxes for some time.
Also, each time Peter buys something and sells it for a larger nominal amount, he will have to pay a tax on the “profit” obtained. Thus, the apartment bought 15 years ago for USD 100,000 and sold today for USD 160,000 will generate a good slice of taxes for the government.
He shouldn’t waste his time explaining the government that those $ 160,000 are not enough for him to buy an apartment equivalent to the one he bought 15 years ago. Much less after paying taxes! And that is because, before passing away, Peter will have suffered the rigors of one of the most perfidious taxes. I am talking about one that most people wouldn’t even recognize as a tax.
It is hidden in the darkness of the economists’ wisdom, far away from a mere mortal’s comprehension of its origins and causes. They call it INFLATION, and it will eat, like cancer, the fruit of Peter’s efforts and work. The disastrous result of its presence in his life is the slow confiscation of the great or little wealth he could have possessed.
But there is more: if the time has come to leave this world, Peter will pay taxes after death and bequeath taxes to his heirs.
Indeed, upon death, in many countries, a perverse Estate Tax will tax the assets of the deceased. At the same time, the Inheritance Tax will fall on their heirs when they receive it.
By the time this happens, they may have to pay a 77.5% “Inheritance, Legacy, and Donations Tax” if they live in a country where a President Correa rules. The real Correa tried to pass this law in Ecuador. Perhaps Peter would have been better off being born in The Netherlands where his heirs would only pay a maximum of 40% …
In some countries like the UK, a couple of years ago, large mansions received in inheritance were going up for sale in a hurry. The reason? So that the heirs could get the money to pay the Inheritance Tax that would ultimately strip them of “their” properties.
It is undeniable that we live at the end of an era that is not familiar to us anymore. Many governments have become a sort of tutor or a father-like figure of their citizens, choosing what is best for them.
Elites of socialist and populist politicians, ignorant in economics and history, rule these countries as their private estates. They pass the wildest laws you can imagine. They restrict the use of cash. They use social security funds at their discretion. They increase and create taxes at will. In a word, they are reducing their fellow citizens to be mere servants of their interests. And these new slaves should be grateful for having some food, some clothing, and a roof to cover their heads.
These politicians look the other way when their financial partners (the real elite?) embark on crazy businesses. When these ill-conceived ventures explode like bubbles in due time, they rescue them with taxpayer money or inorganic money that ultimately affects ordinary citizens. In these “developed” countries, banks are bankrupt as well as their governments.
Unfortunately, the sense of chaos can only be felt by those who are not asleep.
And while most governments are blatantly inefficient when it comes to managing resources, they are super-competent when imposing and collecting taxes. Since taxes constitute their new form of imposed slavery, they don’t ignore opposition. They don’t miss an opportunity to demonstrate their power to force their subjects to pay them.
The inventiveness that governments have to create taxes and adapt them so that they continue to be collected has no limits. The same can be said of their fierceness to force their payment.
A proof of this is England’s infamous tax on chimneys, which the government mutated to a tax on windows. Later on, England transformed it into a tax on bricks and adapted it again to be a taxation proportional to the size of the bricks. Once again, the government converted it to a tax on wallpaper (with death penalty included), and finally changed it again to a tax on candles that lasted 122 years.
At this point, let me ask you if you think that all this is normal. Because, if you don’t see anything wrong here, then there is not a lesson to be studied and learned either.
But, if something inside you rebels against this “new” normal state of things, then I have a question for you. Should a person concerned about themselves and their family trust their government to take care of them?
Or should that person make the decisions about their financial life and take their future in their own hands?
If there is a life lesson from Peter’s story, this is it: “don’t follow the usual way.” So, how can you set yourself free of this servitude?
In general, you’ll have to:
- Know the facts. Start studying the factors that restrict your freedom and prevent you from reaching your financial, health, and wellness goals.
- Study the alternatives. Knowing the facts and establishing the goals will lead you in the search for options.
- Formulate a plan. The analysis of your alternatives will help you in the formulation of actionable plans.
In detail, you’ll need to abide by specific proven rules and strategies that include:
- Acquire a financially independent mentality
- Become disciplined
- Address the poverty complex
- Take care of your health
- Follow the principles of frugality and hard work
- Get out of debts
- Understand the power of perseverance, saving, and compound interest
- Start building your financial foundation
- Become a private person
- Attack the tax problem
- Get a second (and a third) passport
- Start building your financial network
- Start building your offshore structure
- Understand the importance and weight of different asset classes
- Invest
- Plan your state to protect your legacy
- Understand the importance of your family
- Understand the importance of your children’s education and preparation
- Create trusts and foundations for the protection of your assets
- Stay alert and informed
Here’s to your future!
— Víctor Tapia —
Thank you for reading this article. If you have any questions or concerns, leave a comment below, I promise to respond.
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COMPLETENESS is the publication that studies the factors that restrict your freedom and prevent you from reaching your financial, health, and wellness goals. It analyzes the alternatives at hand and formulates and discusses actionable strategies.
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Víctor Tapia is a writer who specializes in bitcoin, internationalization, and wellness issues. For his website’s web presence, he writes and edits both English and Spanish articles, guides, and courses. Similarly, he focuses on producing material for other parties and produces Medium stories on various themes related to his field.
Víctor worked for many years in the field of food and beverages, both for the hospitality and food industries. Before founding My CBS in 2002, he was the General Manager at Parmalat S.p.A., the multinational food corporation, at its subsidiary in Curaçao. One of his activities is service coaching in any area of commerce and industry, including food and beverages.
You can get in touch with him on LinkedIn, Twitter, Facebook or Instagram, follow his posts on Medium, Mixturas (Spanish) and Completeness (English), or by visiting his website, My CBS.
