Front Page Titles (by Subject) 4.2.: Constitutional Tax Choice - The Collected Works of James M. Buchanan, Vol. 9 (The Power to Tax: Analytical Foundations of a Fiscal Constitution)
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4.2.: Constitutional Tax Choice - James M. Buchanan, The Collected Works of James M. Buchanan, Vol. 9 (The Power to Tax: Analytical Foundations of a Fiscal Constitution) 
The Collected Works of James M. Buchanan, Vol. 9 The Power to Tax: Analytical Foundations of a Fiscal Constitution, Foreword by Geoffrey Brennan (Indianapolis: Liberty Fund, 2000).
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Foreword and coauthor note © 2000 Liberty Fund, Inc. © 1980 Cambridge University Press.
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Constitutional Tax Choice
As in our discussion of income taxation, our quarrel is not with the logic of the orthodox conclusions. It is, instead, with the setting within which the questions are posed. Once the implicit “benevolent dictator” conception of political process is rejected, the appropriate role for normative tax analysis becomes that of offering assistance to the individual, the potential taxpayer, who, at a constitutional level of deliberation, is presumed able to select among the alternative fiscal powers and instruments to be made available to government. Such assistance is not, however, in the form of ethical-moral principles telling the individual how he “should” behave in a constitutional choice situation. For the most part, constitutional tax analysis becomes technical and is designed to provide a basis for an understanding of how alternative fiscal arrangements may be predicted to operate, a basis from which some choice must ultimately be made.
Given a model of revenue-maximizing government, the implied normative conclusions about commodity taxation follow the spirit of those outlined in Chapter 3. And they are diametrically opposed to those that emerge from the standard treatment. For example, the lump-sum tax does not constitute the “efficiency” ideal. Under lump-sum taxation, the individual can expect only maximum exploitation by the fisc. Under almost any projection of demands, revenue collections would be predicted to be grossly in excess of those that might be required to finance expenditures on public goods and services. In much the same sense, the minimally distorting set of excises (i.e., with rates related inversely to the degree of substitutability with leisure) serves to raise maximum revenue limits above those implied by a uniform commodity tax and almost certainly to increase total revenue beyond desired levels. Indeed, a restriction that all rates on taxable commodities be identical might well be instituted precisely as a means of restricting Leviathan’s fiscal appetites.
In the more formal analysis that follows, we offer analytic support for these conclusions. More specifically, we deal with two sorts of questions. First, what are the effects on maximum revenue yield of alternative forms of restriction on commodity-tax institutions? Second, given a choice among various forms of commodity tax all of which yield the same maximum revenue, which, if any, is to be preferred?