Abstract
This article is not about the war on drugs or the campaign against big tobacco, nor does it concern the debate regarding the world’s oldest profession. It is about a tax vice. Tax jurisprudence is quickly approaching a mature consensus that tax shelters constitute a definable societal vice—something in which many individual taxpayers might participate if given the opportunity, but which is invariably harmful to the whole. The question then becomes how society should allocate it’s enforcement resources to eliminate tax shelters. Presently, tax law is disproportionately concerned with directing enforcement resources against “consumers” of tax shelters (e.g., taxable individuals or entities that essentially buy tax benefits) and insufficiently concerned with “producers” (e.g., charities and other “zero-bracket taxpayers”) that willingly put tax benefits on the market. Some producers, foreign taxpayers, in particular, are beyond tax law’s jurisdictional reach and that fact explains the lack of enforcement measures against those producers. But this is most certainly not the case for Charity. Charity has been within regulatory jurisdiction at least since the day it began operating a macaroni factory in competition with taxable entities. There is not even an purely logistical reason why tax law should ignore Charity’s role in the tax shelter market. If shelters constitute a vice that threatens core values of our taxing system, tax law should focus its enforcement efforts against all participants, not just consumers.
This article therefore introduces a “drug-war” thesis that deems the enforcement focus on consumers insufficient. When Charity “produces” tax shelters, tax law should not only enforce its displeasure against the consumer, but against Charity as well.
Recommended Citation
Darryll K. Jones,
When Charity Aids Tax Shelters,
4 Fla. Tax Rev.
(2001).
Available at: https://scholarship.law.ufl.edu/ftr/vol4/iss1/15