Paying Taxes – What does the bible say?

Let’s face it – most people don’t like paying taxes. We all come up with excuses of why we shouldn’t be paying taxes.

• The Government spends our taxes on projects/ areas we don’t agree with.
• The Government is wasteful and inefficient.
• The tax rates are too high – I could use that money for myself.
• The tax law is too complicated and tax returns take so long to complete.

People complained about paying taxes even in Jesus’ time. The Roman empire, which had conquered Israel, imposed a heavy financial burden to pay for its army, road systems, courts, temples to the Roman Gods and for the emperor’s personal wealth.

Taxes were handled differently then – they were paid directly to a local tax collector, who arbitrarily decided what you were going to pay. Tax collectors did not receive a salary. They got their pay by charging people more than what they were owed, so they routinely cheated citizens and didn’t care how they felt about it.

What does the Bible say about paying taxes?

First let’s answer the question, “Did Jesus pay taxes?” In Matthew 17:24-27 we learn that Jesus did indeed pay taxes. “After Jesus and his disciples arrived in Capernaum, the collectors of the two-drachma tax came to Peter and asked, “Doesn’t your teacher pay the temple tax?”  “Yes he does,” he replied. When Peter came into the house, Jesus was the first to speak. “What do you think Simon?” he asked. “From whom do the kings of the earth collect duty and taxes – from their own sons or from others?” “From others” Peter answered. “Then the sons are exempt” Jesus said to him. “But so that we may not offend them, go to the lake and throw out your line. Take the first fish you catch; open its mouth and you will find a four- drachma coin. Take it and give it to them for my tax and yours.”

The Pharisees tried to trap Jesus in his words and find a reason to accuse him. In Matthew 22:15-22 we read:

Then the Pharisees went out and laid plans to trap him in his words. They sent their disciples to him along with the Herodians.  “Teacher,” they said, “we know that you are a man of integrity and that you teach the way of God in accordance with the truth. You aren’t swayed by men because you pay no attention to who they are. Tell us then what is your opinion? Is it right to pay taxes to Caesar or not?” But Jesus, knowing their evil intent, said “You hypocrites, why are you trying to trap me? Show me the coin used for paying the tax.” They brought him a denarius, and he asked them, ”Whose  portrait is this? And whose inscription?” “Caesar’s,” they replied. Then he said to them, “Give to Caesar what is Caesar’s, and to God what is God’s” When they heard this they were amazed. So they left him and went away.

So the Gospels leave no doubt that Jesus taught his followers not only in words but by example, to give to the Government any taxes that are owed.

In Romans 13:1, Paul brings further clarification to this concept, along with an even broader responsibility to Christians:

“Everyone must submit himself to the governing authorities, for there is no authority except that which God has established. The authorities that exist have been established by God.”

Let’s put these Biblical references into context with our attitude to paying taxes and preparing our own tax returns. Primarily, our tax returns should be prepared using correct factual information, honestly and within the tax laws legislated by the Government.

• Cash income – we all know that many businesses have the potential to earn “cash income” that is not deposited in the bank account or recorded in the tax return and therefore no income tax or goods and services tax is paid on this income. Do you think that this is honest and in accordance with the tax laws?
• Tax Deductions – claims for tax deductions must be supported by receipts and appropriate documentation. Some times the receipts or records can be lost or the expense may not be sufficiently connected to the earning of income. It is best to seek professional advice from an accountant or tax agent  to ensure that the claims are honest and “reasonably arguable” to the Tax Office if required.
• Fairness of tax law – there are many tax laws that seem unfair for different taxpayers eg income splitting between family members for businesses whereas salary earners are unable to split income between family members. Tax laws can only be changed by Parliament, so in the meantime we are bound to abide by the tax laws as legislated, no matter how unfair they may seem.
• Tax evasion – some taxpayers and consultants devise dubious schemes to try and reduce tax. Again as Christians, we are required to pay our taxes honestly and we should not be misled into schemes to illegally avoid paying tax.

Ultimately it is our God given conscience that helps us determine whether we are paying our taxes correctly, honestly and in accordance with the tax law. And if you need guidance in any tax matters, take it to God in prayer and seek professional advice.

Prepared by Mel Zerner