1. Peter Dietsch & Thomas Rixen, “Tax Competition and Global Background Justice” (2014) 22:2 J Political Philosophy 150 at 152; Buchanan, James M, The Limits of Liberty: Between Anarchy and Leviathan (Liberty Fund, 2000)Google Scholar. By “consensus” I mean that nearly all people “at least” accept this task. The field of public finance, however, traditionally goes further by including all four. See Rosen, Harvey S, “Public Finance” in Rowley, Charles & Schneider, Friedrich, eds, The Encyclopedia of Public Choice (Springer US, 2004)Google Scholar. James Buchanan famously limits the task of the state to the minimalist stance, which he calls “the protective state.”

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4. Christians, “Trust in the Tax System”, supra note 3 at 152.

5. This involved a certain shift, as the tax literature neglected political reality for a long time. The standard texts on public economics do not mention the issues of fiscal complexity or the influence of lobbying. A shift toward a normative assessment of existing tax systems was partly generated by the 2008-2010 economic and financial crisis and the subsequent fiscal crises in several European countries, which provoked a stricter form of fiscal orthodoxy, with a more stringent monitoring of compliance by taxpayers. At the same time, events like Swissleaks, Luxleaks, and the Panama Papers and Paradise Papers have revealed that many multinationals and wealthy individuals use various legal techniques to avoid paying national taxes. Lastly, and connected, the field of taxation has gained popularity through an increased interest in economic inequality via the popularity of Thomas Piketty’s Capital in the 21st Century. The interest in the legitimacy of prevailing tax systems is mirrored in a number of contributions in Bhandari, “Introduction to Philosophical Foundations of Tax Law”, supra note 3, and in Building Trust in Taxation, supra note 3, in a number of contributions.

6. Binh Tran-Nam & Chris Evans, “Towards the Development of a Tax System Complexity Index” (2014) 35:3 Fiscal Studies 341; Hettich, Walter & Winer, Stanley L, Democratic Choice and Taxation: A Theoretical and Empirical Analysis (Cambridge University Press, 1999)CrossRefGoogle Scholar at 90.

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8. Raquel Alexander, Susan Scholz & Stephen Mazza, “Measuring Rates of Return for Lobbying Expenditures: An Empirical Analysis Under the American Jobs Creation Act” (2009) 25 JL & Pol 401.

9. Jennifer L Brown, Katharine D Drake & Laura Wellman, “The Benefits of a Relational Approach to Corporate Political Activity: Evidence from Political Contributions to Tax Policymakers” (2015) 37:1 J American Taxation Association 69.

10. House of Commons Committee of Public Accounts, “Tax Avoidance: The Role of Large Accountancy Firms” (April 26, 2013), online: https://www.parliament.uk/business/committees/ committees-a-z/commons-select/public-accounts-committee/inquiries/parliament-2010/tax-avoidance-role-large-tax-accountancy-firms-follow-up/.

11. David Lundy, “Lobby Planet Brussels: The Corporate Europe Observatory Guide to the Murky World of EU Lobbying (June 2017), online: https://corporateeurope.org/lobbyplanet.

12. Profile for 2016 Election Cycle (Apple Inc), Center for Responsive Politics (November 23, 2017), online: https://www.opensecrets.org/orgs/summary.php?id=D000021754.

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15. Shaun P Hargreaves Heap, “Behavioural Public Policy” (2017) 1:2 Behavioural Public Policy 252 at 259.

16. Geoffrey Brennan, “Politics-as-Exchange and “The Calculus of Consent”” (2012) 152 Public Choice 351 at 351-52; Roger D Congleton, “The Contractarian Constitutional Political Economy of James Buchanan” (2014) 25:1 Constitutional Political Economy 39 at 44-45 [Congleton, “The Contractarian”]; Rawls, John, A Theory of Justice, revised ed (Belknap Press, 1999)Google Scholar at 3, 10; Buchanan, James M & Congleton, Roger D, Politics by Principle, Not Interest: Towards Nondiscriminatory Democracy (Cambridge University Press, 1998)CrossRefGoogle Scholar at 4 [Buchanan & Congleton, Politics by Principle].

17. Rawls, A Theory of Justice, supra note 16 at 16.

18. Brennan, “Politics-as-Exchange”, supra note 16 at 352; Congleton, “The Contrarian”, supra note 16 at 44-45; John Rawls, Collected Papers, edited by Samuel Freeman (Harvard University Press, 1999) [Rawls, Collected Papers]; Rawls, A Theory of Justice, supra note 16 at 12; Geoffrey Brennan & James M Buchanan, The Reason of Rules (Liberty Fund, 2000) at 27 [Brennan & Buchanan, The Reason of Rules].

19. Rawls, Collected Papers, supra note 18 at 58; Brennan & Buchanan, The Reason of Rules, supra note 18 at 35; Hayek, FA, The Road to Serfdom: Text and Documents—The Definitive Edition, edited by Caldwell, Bruce (University of Chicago Press, 2007)CrossRefGoogle Scholar at 113 [Hayek, The Road to Serfdom]. The moral justification of this paper is contractarian, and hence Rawlsian, in the sense that the rules that are just are those that would be chosen within the setting of constitutional choice. The specific constitutional setting, however, is Buchananite rather than Rawlsian: see Part 3.1. of this paper.

20. Buchanan & Congleton, Politics by Principle, supra note 16 at 6-7; Buchanan, James M, The Logical Foundations of Constitutional Liberty (Liberty Fund, 1999)Google Scholar at 146 [Buchanan, Logical Foundations].

21. Brennan, “Politics-as-Exchange”, supra note 16 at 356.

22. Buchanan & Congleton, Politics by Principle, supra note 16 at 18; Brennan & Buchanan, The Reason of Rules, supra note 18 at 35.

23. Congleton, “The Contractarian”, supra note 16 at 46.

24. John Rawls, “Kantian Constructivism in Moral Theory” (1980) 77:9 J Philosophy 515 at 519 [Rawls, “Kantian Constructivism”].

25. John Thrasher, “Ordering Anarchy” (2014) 5 Rationality, Markets and Morals 30.

26. Buchanan, Logical Foundations, supra note 20 at 133.

27. Brennan, “Politics-as-Exchange”, supra note 16 at 352; Brennan & Buchanan, The Reason of Rules, supra note 18 at 19, 128.

28. Butler, Eamonn, Public Choice (The Institute of Economic Affairs, 2012)Google Scholar at 77.

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30. Note that this does not mean that individuals have no other motivations. All that is required for studies of different consequences of different rules is that self-interest is one among several motivational factors. To focus on how different rules create different outcomes given the self-interested postulate, we are required to isolate the former and thus model individuals as being uniquely self-interested.

31. Buchanan, James M & Tullock, Gordon, The Calculus of Consent: Logical Foundations of Constitutional Democracy (Liberty Fund, 1999)Google Scholar at 132 [Buchanan & Tullock, Calculus of Consent].

32. Buchanan & Congleton, Politics by Principle, supra note 16 at 90.

33. Buchanan & Congleton, Politics by Principle.

34. Buchanan & Tullock, Calculus of Consent, supra note 31 at 132-49.

35. Buchanan also isolates the funding part of the exchange from the expenditure. For instance, Buchanan & Tullock, ibid at 137, focus on spending decisions by a majority under the presumption of an equal property tax on all citizens. See also Buchanan and Brennan, The Reason of Rules, supra note 18. Nonetheless, I acknowledge the two-sidedness of the fiscal account; i.e., that taxation is part of public economics sensu latu, and that the justice of taxation depends on the consequent distribution of public goods among the constituency. See, for instance, Buchanan, Logical Foundations, supra note 20 at 133-49.

36. Buchanan & Congleton, Politics by Principle, supra note 16 at 30.

37. For reasons of simplicity, I also assume they realize the same subjective value from this consumption of public goods.

38. I do not wish to “prove” that collective action needs to be a collective loss under these institutional arrangements. All that the coalition “social justice” shows is that it is possible that such is the case, as the majority can make profits while the overall utility is negative. For more discussion, see points 2 and 3 hereafter, within this section.

39. Buchanan & Tullock, Calculus of Consent, supra note 31.

40. Ibid at 141-42, 168; Gwartney, supra note 29 at 18.

41. Buchanan & Tullock, Calculus of Consent, supra note 31 at 166; Gaus, Gerald, The Order of Public Reason: A Theory of Freedom and Morality in a Diverse and Bounded World (Cambridge University Press, 2011)Google Scholar at 544 [Gaus, The Order of Public Reason].

42. Ibid at 542; Gwartney, supra note 29 at 19.

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44. Gaus, Gerald F, On Philosophy, Politics, and Economics (Cengage Learning, 2008)Google Scholar at 195 [Gaus, On Philosophy].

45. Buchanan & Congleton, supra note 16 at 91.

46. Gaus, The Order of Public Reason, supra note 41 at 545.

47. Brennan & Buchanan, The Reason of Rules, supra note 18 at 135.

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51. Ostrom & Ostrom, supra note 48 at 190.

52. Butler, supra note 28 at 62.

53. Ostrom & Ostrom, supra note 48 at 181, 193.

54. Butler, supra note 28 at 58-59.

55. Brennan & Buchanan, The Reason of Rules, supra note 18 at 3.

56. Buchanan & Tullock, Calculus of Consent, supra note 31 at 85-96.

57. Christians, “Trust in the Tax System”, supra note 3.

58. Buchanan & Tullock, Calculus of Consent, supra note 31 at 285-86.

59. Peeters, Gribnau & Badisco, “Preface”, supra note 3.

60. Ostrom & Ostrom, supra note 48 at 192.

61. Brennan, “Politics-as-Exchange”, supra note 16 at 353.

62. Buchanan & Tullock, Calculus of Consent, supra note 31 at 285; Thrasher, supra note 25 at 37.

63. Rawls, A Theory of Justice, supra note 16 at 11.

64. Gaus, Gerald & Thrasher, John, “Rational Choice and the Original Position” in Hinton, Timothy, ed, The Original Position (Cambridge University Press, 2015) 39CrossRefGoogle Scholar at 46.

65. Rawls, A Theory of Justice, supra note 16 at 11.

66. Buchanan & Congleton, Politics by Principle, supra note 16 at 6-7; Brennan & Buchanan, The Reason of Rules, supra note 18 at 34.

67. In other words, in order to reveal the true principles of justice, Rawls employs “ignorance”—a condition under which imaginary choosers have no knowledge of their own identity. Buchanan’s “veil of uncertainty” (together with Brennan and later Congleton) creates a lower yet more realistic level of uncertainty: uncertainty is introduced through the generality and the quasi-permanence of constitutional rules. This test is more feasible, in the sense that in various aspects of life, people are required to choose rules under conditions of uncertainty about their specific effect on their position (e.g., when prospective partners vote on the operational rules of a company or when we decide upon the rules of a party game). Remarkably, Rawls did not always assume a veil of ignorance. In Rawls, “Justice as Fairness,” in Samual Freeman, ed, Collected Papers (Harvard University Press, 1999) at 47-72, he characterizes the original position as a setting in which players have full information of their circumstances. See also Gaus & Thrasher, supra note 64; Buchanan, Logical Foundations, supra note 20 at 146 n 7.

68. Ibid at 146.

69. Geoffrey Brennan & Alan Hamlin, “Constitutional Political Economy: The Political Philosophy of Homo Economicus?” (1997) 3:3 J Political Philosophy 280 at 290-91.

70. Rawls, Collected Papers, supra note 18 at 54. Rawls, when employing a model affiliated with the one here, equally stretched the importance of the requirement of generality: “… each person will propose principles of a general kind which will, to a large degree, gain their sense from the various applications to be made of them, the particular circumstances of which being as yet unknown.” Ibid. For an extensive elaboration, see Gaus & Thrasher, supra note 64 at 45. Here I investigate the specific value of these kinds of requirements.

71. Rawls, Collected Papers, supra note 18 at 54. See “Justice as Fairness,” supra note 67 (“Having a morality must at least imply the acknowledgment of principles as impartially applying to one’s own conduct as well as to another’s.”).

72. Rawls, A Theory of Justice, supra note 16 at 117.

73. Buchanan & Congleton, Politics by Principle, supra note 16 at 6.

74. Åsbørn Melkevik, “No Progressive Taxation Without Discrimination?” (2016) 27: 4 Constitutional Political Economy 418.

75. Hayek, The Road to Serfdom, supra note 19 at 114.

76. Bhandari, supra note 3 at 1-9.

77. Indeed, the search for generality pertains not just to the applicable rate structure but depends equally on the definition of “income.” If political agents have the legislative liberty to define when taxable income occurs, the problems we aim to solve would reoccur within the confines of our solution. Moreover, excluding some income from the tax base equals a tax exemption of 0%. For a defense of a consistent and broadly defined tax base, see Delmotte, Charles, “The Right to Autonomy as a Moral Foundation for the Realization Principle in Income Taxation” in Bhandari, Monica, ed, The Philosophical Foundations of Tax Law (Oxford University Press, 2017) 281CrossRefGoogle Scholar.

78. Buchanan & Congleton, Politics by Principle, supra note 16 at 137.

79. Buchanan & Congleton, Politics by Principle, supra note 16; Epstein, Richard A, Simple Rules for a Complex World (Harvard University Press, 1995)Google Scholar at 138.

80. Buchanan, Logical Foundations, supra note 20 at 142.

81. Gwartney, supra note 29 at 18; Buchanan & Congleton, Politics by Principle, supra note 18.

82. Richard A Epstein, “Can Anyone Beat the Flat Tax?” (2002) 19 Social Philosophy and Policy 140. Efficiency is conceptualized here as the Pareto norm: no one can be made better off without someone else being made worse off. Gaus, On Philosophy, supra note 44. Uniformity compensates for the departure from the unanimity requirement within a majoritarian democracy. Buchanan, Logical Foundations, supra note 20 at 145-46.

83. Barbara H Fried, “The Puzzling Case for Proportional Taxation” (1999) 2 Chapman L Rev 157 at 160 [Fried, “The Puzzling Case”].

84. Buchanan & Congleton, Politics by Principle, supra note 16 at 93.

85. A seminal insight of this kind convinced Mill to state that everybody should bear the same utility loss and to elaborate his “equal sacrifice” principle. See John Stuart Mill, Principles of Political Economy: with some of their applications to social philosophy, 7th ed (Longmans, 1909) at 804.

86. Epstein, “Can Anyone Beat the Flat Tax?” supra note 82 at 160; ERA Seligman, “Progressive Taxation in Theory and Practice” (1908) 9 American Economic Association Quarterly 1 at 216; H Peyton Young, “Progressive Taxation and Equal Sacrifice” (1990) 80:1 American Economic Rev 253.

87. In other words, the estimation is that the interpersonal variance in utility curves does not suggest that individuals, choosing the constitutional principles of taxation, would deny this insight.

88. Majorities could do this when they are able to discriminate in terms of spending, which they are not in my example. See Brennan, Geoffrey & Buchanan, James M, The Power to Tax: Analytical Foundations of a Fiscal Constitution (Liberty Fund, 2000)Google Scholar.

89. Young, supra note 86.

90. Peter Diamond & Emmanuel Saez, “The Case for a Progressive Tax: From Basic Research to Policy Recommendations” (2011) 25:4 J Economic Perspectives 165; Hettich & Winer, supra note 6.

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93. Ibid at 157.

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96. Ibid at 143.

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