Some reflection on the Republic of China’s Judicial Day, from the point of view of a Western scholar.

by Massimo Introvigne

An article already published in Bitter Winter on January 11th, 2021.

The Judicial Yuan, Taipei, R.O.C.
The Judicial Yuan, Taipei, R.O.C. Credits.

The Republic of China (R.O.C.) Judicial Day dates back to January 11, 1943. In that day, the R.O.C. entered into a new “treaty of equality” with the United States and the United Kingdom, making R.O.C.’s judicial system completely independent from any foreign jurisdiction. The Judicial Day is celebrated every year, and is an opportunity to reflect on justice and judicial reform.

I am honored to be invited to participate in the forum “Tax Reform with Conscience to Save Taiwan,” organized by a number of groups, including Taiwan’s Center for Financial and Legal Studies and the Taiwan Society of Financial and Criminal Law, for the Judicial Day 2021, and to share some reflections about tax justice. I understand most participants to the event are from Taiwan, while mine is rather a Western perspective.

In the West, since the Middle Ages, the idea of justice, including tax justice, was largely developed through the reflection of Christian theologians, whose teaching about society was based on two principles, the principle of solidarity and the principle of subsidiarity.

The principle of solidarity is that, to put it simply, we are all in the same boat. We citizens should help each other. And one way is helping through taxes. If one of us has a job, and somebody else does not have a job, the former one who has a job would pay taxes to support the poor guy who is unemployed. So, the principle of solidarity is the foundation of the duty to pay taxes. But this is only one of the two principles regulating a good society. There is a second principle, the principle of subsidiarity, which the Protestants call the principle of sphere sovereignty.

The Catholics use the word “subsidiarity,” and the Protestants prefer the Calvinist notion of “sphere sovereignty,” to indicate the same reality. It means that each of us is sovereign in his or her own sphere. And the state should respect this liberty and sovereignty, without infringing on it. The state should respect the sphere of liberty of private citizens, of families, of local communities, of businesses, and certainly of religious and spiritual institutions.

If the state is not fair, if it exaggerates in taxation, if the process of taxation and the recourses open to taxpayers in case of illegal taxations are not equitable, are not clear, or are not working, the taxpayers, be they individual citizens or corporate entities, such as a business or an association or a religious body, would lose their liberty.

Based on the principle of solidarity, it is right to pay taxes, to contribute to the state, and to promote the well-being of the less fortunate. Based on the principle of subsidiarity or sphere sovereignty, the taxes, the taxing process, and the tax administration should be fair, their requests should not be excessive, and they should always respect the sphere of autonomy of the individuals, the families, and the corporate bodies, including religious institutions.

In practice, it is not easy, of course, to combine the principle of subsidiarity with the duty to pay taxes; and the principle of solidarity with the duty of the government and of the administration to make the process of taxation fair and legal. But that is the key to democracy. There is no democracy without fair and transparent taxation, and without effective recourses available to the taxpayers when they believe something wrong is happening to them.

Economists tell us that, since the modern states become more and more complicated, the bureaucracies also become more and more complex, and the risk grows that the delicate balance between solidarity and subsidiarity is broken. But that is the challenge of modern democracies, which are called to keep this risk in check.

In practical terms, we should make sure of two things. First, that the quantity of taxation is not exaggerate. Second, and perhaps this is even more important than the first requirement, that the quality of the tax process respects the principle of democracy. In other words, the tax process should be clear, transparent, and allow taxpayers to represent their reasons, to be heard, to have their fair day in a court of law.

Tai Ji Men protests in Taiwan.
Tai Ji Men protests in Taiwan.

This is one reason why so many experts of religious liberty and of tax justice throughout the world, are now extremely focused on the case of Tai Ji Men in Taiwan. Because this is a textbook case of how the principle of subsidiarity or sphere sovereignty is not working. It is not working because the sphere of liberty of individual Tai Ji Men dizi (disciples) is not respected, the sphere of liberty of Tai Ji Men Academy, a spiritual organization, is not respected, and tax bureaucrats are not kept in check by the law.

In fact, what we have seen in the Tai Ji Men case in Taiwan, is that it was initially a governmental officer, Prosecutor Hou Kuan-jen, who was left more or less free to act against the law. And subsequently, tax officers were also left more or less free to act against the law. The taxpayers, in this case Tai Ji Men and its founder, Dr. Hong Tao-tze, did not have effective recourses when they were wronged. Yes, they won cases in court. But in practice, these victories did not lead to justice.

So, what to do? It seems to me that one of the problems in Taiwan is the system of bonuses. Getting the bonuses encourages rogue tax bureaucrats to run more and more wild. But more in general, I believe the Tai Ji Men case is so important, because it calls for the tax systems in Taiwan and throughout the world, while they claim to enact solidarity, to respect the subsidiarity and the liberty of individual taxpayers and corporate taxpayers, which is all more important when religious liberty is also at stake.