About | HeinOnline Law Journal Library | HeinOnline Law Journal Library | HeinOnline

LOG IN
LOG IN


11 Tenn. L. Rev. 226 (1932-1933)
The Benefit Theory of Taxation

handle is hein.journals/tenn11 and id is 228 raw text is: TENNESSEE LAW REVIEW THE BENEFIT THEORY OF TAXATION By D. T. KRAUSS The field of substantive law has a very close relationship to every aspect of human society. The principles and theories enunciated by courts concerning the aspects of human society, as expressed in judicial decisions, are not by any means in- significant in their import on the destiny of mankind. In ad- judicating conflicting claims courts frequently reveal the legal concepts of the structure of the basic institutions of our society, which concepts have probably had as great a formative influence on our social institutions as that exerted by the non-legal specialists in the fields involved. Legal lore is rich in concepts concerning all aspects of our society. Such concepts, however, when involved in court decisions, may find their justification not in the social or economic realities of a given situation, but in the principles of the narrower field of jurisprudence. Governments must secure money for their maintenance. The power to make compulsory levies on its citizens for its support is inherent in the sovereignty of governments. Such power is said to be legislative and not judicial in nature and is said to be limited only by constitutional prohibitions. Legislatures pass tax laws which, in effect, allocate the costs of government to the constituent elements of the population in whose welfare the government is concerned. Probably one of the earliest principles followed in the levying of taxes was that a tax was a payment for services received by the tax payer from his gov- ernment or overlord. The payments and services made by a vassal to his overlord for protection in the feudal society of the middle ages can be explained on such a theory. This system broke down with feudal society, although it has somewhat of a counterpart today in the system of fees charged by govern- mental agencies for special services. Constitutions, statutes, and courts in their decisions and dicta give expression to certain concepts and theories of tax- ation. It is the purpose of this article to examine one such theory of taxation, namely, that of taxation according to the benefits or advantages received by the taxpayer and to set forth the credence that has been given to this theory of taxation by the courts.