I mentioned boycotts of government-produced or -taxed goods and services as a variety of tax resistance or a tactic that has accompanied tax resistance campaigns. I covered the related tactic of manufacturing and selling untaxed alternatives to taxed goods.
Today I’m going to cover another tactic in the same ballpark: the use of smuggling to get consumer goods to market while evading a tax or a government-enforced monopoly. Smuggling can serve a tax resistance movement in multiple ways:
- Smuggling can deprive the government of revenue.
- Smuggling can raise money for resistance activities.
- Smuggling can forge bonds between a variety of people in a geographically distributed, semi-organized underground, in a way that can later be capitalized on for resistance activity.
Here are some examples of smuggling being used in the course of tax resistance campaigns:
- In the years leading up to the American Revolution, “the restrictions on
imports from the West Indies were systematically and persistently ignored,
producing a condition of smuggling so universal and well-nigh respectable
as to raise the question whether the operations of the merchants could
properly be designated by that term.”
Indeed the economy of the American colonies relied on smuggling to such an
extent that the government’s threat to crack down on the evasion of duties
on imported molasses did more to fan the flames of revolution than any of
its other saber-rattling. Revolutionary John Adams wrote later:
I know not why we should blush to confess that molasses was an essential ingredient in American independence. Many great events have proceeded from much smaller causes.
- The U.S. government tried to defeat the Whiskey Rebellion by purchasing as much taxed whiskey as it could get its hands on (ostensibly as requisitions for the Army) while at the same time trying to interrupt the black market for untaxed whiskey by seizing what they could find of it. This didn’t work as planned, as the rebels shifted to smuggling their goods out of the state, “to the territory northwest of the Ohio [river],” where the tax law did not apply.
- A Colombian anarchist recently published a guide to “Contraband as a Strategy of Tax Avoidance” to help potential tax resisters in countries where a value-added or sales tax is the primary funder of the national treasury.
- Gandhi’s salt march and salt raids promoted the harvesting, distribution, and sale of salt illegally produced outside of the approved government monopoly.