Europe Needs to Consider Tax Bonus for Parents

From the desk of Martin Helme on Fri, 2006-01-13 18:49

It is beginning to dawn on the Europeans that they are a dying breed, literally. Demographically, white Europeans are the fastest shrinking population in the world. The reason, of course, is that they do not have enough children to replace the dying generations.

Countries have tried different methods to remedy this. A frequent policy in the West is to grant bonuses to women who give birth. Estonia, for instance, has introduced a one year parent salary to the same amount as the mother received in the year before she had the baby. Such methods, however, tend to be state-centred and depend on government intervention in matters of a thoroughly personal nature.

Some are calling for the reintroduction of a childless tax. Under Soviet rule Estonia, like other provinces of the Soviet empire, had a tax on childlessness. Like everything else in the Soviet Union this tax was not very efficient. Hungary, too, had a childlessness tax.

There is, however, a better solution for countries that wish to encourage people to have more children, namely to establish a tax bonus for raising children. For every child living in their household parents could be given a 5% tax break. In a flat tax system where adults are taxed at 30% of their income, a family with two children would then pay 20% income tax, a family with four children would pay 10%, and parents of six children would pay no income tax at all.

Such a system is simple and easy to administrate. There is little room for abuse of the system and it will act as an incentive to have children. It is also in line with the philosophy of small government. Taxes should not punish people or redistribute wealth.

A number of difficult issues will be avoided if the 5% tax break is granted for every child in the household. One would not have to decide, as with the childlessness tax, how young or old someone should be in order to get the bonus. Why should the state decide such a thing anyway? There would be no need either to decide how long the tax measure should be in place. Till the end of fertility (which is at different ages for men and women) or till their retirement? Or till death? With a tax bonus, it is simple. If an 18-year old has a child, the parent will get the tax break. If someone in their 40s starts a family, they will get the break then. And as soon as the children leave home the extra economic burden for the parents is eliminated, so the tax credit will disappear and people will go back to paying taxes at the normal rate.

If a person has raised six children and, consequently, has paid no income taxes, he will start paying once the children leave home or finish their studies and earn their own income. Of course, this does not happen with all children at the same time. Moving into the full paying category will happen gradually, just as moving into the tax break category happened gradually.

This system would also be simple for families. Parents who raise their children on their own get the bonus. A parent not living with the children would pay the regular tax in full. Apart from constituting a significant economic help for single parents it would also motivate adults to raise their children together and not abandon their partner and children.

Such a system will also eliminate accusations that people with fertility problems are unjustly punished, as was the case with the childlessness tax. They are not punished, but simply pay the normal income tax level. Moreover, people who adopt children will also get the tax reduction.

As the purpose of the tax break would be to encourage higher birthrates among Europeans, it is clear that the tax break will apply only to citizens and not to immigrants (though the adopted children of citizens may of course be of foreign origin).

It is clear that the economic burden for large families is far greater than for couples. It is also clear with respect to society that children raised today will have to pay both for their own parents’ pensions and for the pensions of people who choose not to have children. Childless people live at the expense of current parents and their children. A tax break for children will balance this injustice. Some claim that this argument does not hold for childless people who have provided for their own private retirement accounts. These accounts, however, exist in societies whose economic wealth depends on the next generation. If the entire community dies off then the account will do you little good. Moreover, parents with children have less means to save for their own future private retirement funds. Hence, one could also consider to have pension sums dependent on the number of children people have raised.

Immigration cannot provide the solution for the European birth dearth, especially when the immigrants have a fundamentally different cultural background. The current situation in Western Europe shows that if immigrants come in too large numbers they have a highly destabilizing effect on society. There are also indications that in Western welfare state systems immigrants consume more public services – such as social benefits, hospitals, police, jails, schools, etc. – than they contribute. This puts a great strain on the public purse. Moreover, immigrants, too, will retire eventually. Hence in the long run there is no benefit from immigration in demographical terms either. If the birth dearth continues additional immigrants will have to be attracted and the original inhabitants of Europe will become an ever smaller minority.

When one considers national tax receipts one notices that, certainly in a flat tax economy, the contribution of poorer people constitute but a fraction of the sum taken from the richer ones. A tax bonus is beneficial to the poorer end of the population. Statistics show that the more children a family has the higher its risk of poverty. Or, to put it differently: richer people have fewer children. In that regard it is irrelevant which is the cause and which the effect – whether children cause poverty or whether affluence causes a lack of children. What is important is that poorer, larger families would receive support without hurting tax revenue too much.

Consequently, if a progressive child tax break system were introduced, the sheep would be taken care of while the wolves are fed. The poorer, larger families would be helped while the rich would not be punished, the government would not go bankrupt and – most important of all – European peoples, such as the Estonians, will not be extinct by the end of the century.

Social engineering?

Submitted by martinhelme on Tue, 2006-01-17 14:30.

I categorically deny being a socialist with intent on social engineering. I am as right wing as you can get without shaving your head. Plus I'm a conservative.

I have to agree with averything that Ethnocentrist said. If being curly haired and brown would eradicate poverty, ignorance and disease, Arabs would be living in paradise. But we see no evidence of this part of the world "concentrating on being nice to each other".

All those who are talking about state not deciding these very personal matters should consider this: first, a tax break is exactly the sort of small government solution. I have to stress, that I do not support the childlessness tax. But a tax break is completely different thing. Second, say what you want, but it's all about money – people are smart about their economics and they act to what is in their personal interest. No amount of patriotic or evangelical emotional appeals will outweigh this. At the moment, economic environment is heavily against large families. And it is ridiculous to pretend that state has not been central player in setting up this sort of economical reality. C'mon, this is EU, everything in here is state-run and regulated.

Thirdly, I urge even the most fanatical free marketers (who I am as well) to ask themselves, which is more horrific: becoming extinct or changing the tax system to support family and survival of our culture and breed.

Despite the fact that Estonians are in a very serious demographical situation, I share not the pessimistic view that it's all over, it's too late, we as a race are already walking dead. As Lenny Krawits said: it aint over till it's over. And I offer you this historic evidence. After Livonic war (1558-1583) there were as few as 100 000 Estonians. Within a hundred years, the number rose to about 400 000. Then came the great famine, succeeded by Nordic war (famine in 1697-99, war between 1700-1710) and the population again fell to 100 000. Within two centuries, the number rose to about a million, where it still stands. The First WW killed about 200 000 Estonians, the Second WW wiped out even more, plus the soviet death camps that followed. But we are still here! By the way, in every one of those disasters (except the famine) Russians played pivotal role…

It is just as well, that I am an Estonian, not Belgian, because I know for a fact, that up here we still have freedom, back in "core Europe" you only have democracy. The obvious difference of course is the fact that in a free society one can offer controversial ideas and suggest solutions that the elites do not want to accept. The worse one has to fear is harsh criticism. In a democratic society, one has to first and foremost worry that one does not upset anyone. Worse that can happen is that you are jailed. Such a democracy, you can keep. Unfortunately, Estonia is since 2004. under EU regime and it's freedom and the freedom of it's citizens is disappearing fast. Take a guess with what it is being substituted. If you bet your money on "tolerance" you're a winner.

I am not one that is a big

Submitted by Ethnocentrist (not verified) on Mon, 2006-01-16 06:31.

I am not one that is a big believer of government and their ability to fix things. However, this is somewhat a noble-ish gesture and appears idiot proof. I think it is worth a try to at least help to kick start the fertility rate of Europe considering it has been ravaged by liberalism and strangulating taxation. It is also a fallacy that we need to continue replacing the exact number of people per country. Japan has decided to pare down their population to turn of the century levels and has decided to forge ahead into this new millenium with new technology instead of new immigrants. The next several generations will be difficult for them but in the end, they will hold onto Japan. This cannot be so clearly stated for Europe and the west.

I am aghast at Bob Doney's statements not only for they are full of outright fallacies, but more importantly for their overt racism directed at white Europeans. I can only hope he writes such things in jest, yet it does not appear to be the case. This Bill Clinton and Phil Donahue yearning of browning the white population is absurd, racist, and fallacious in that it is only the WHITE man who brings war, pestilence, famine, and death to the world. As if it needed to be said, though given some of the comments it appears that it does; conflict is a human failing and conflict of all varieties occurs amongst all people and we have seen with our very eyes the horrors of this human conflict in sub-Saharan Africa, India & Pakistan, Indonesia, China, and Central & South America. All these places have been in conflict long before any white man graced their lands and will do so long after. These places also seem to me to be "brown" enough, yet it did not prevent them from engaging in war against one another.

Next point is his MSM style propagation of blue eyed, blonde hair as some evil that is in need of "eradication" in order for prevent "racism", failing to realize that if one substitued "wooly hair and black skin" to his thoughtless and meanspirited statement, the PC police would be all over him for incitement of racial hatred. Yet since his attack is against whites and specifically against the fairer complexioned ones, then it not only is accepted but also encouraged. Is Mr. Doney as insensitive towards the handicapped or the "slanty" eyed as well with the same demeanor as he is with blue eyed blondes?

Next fallacy is his assertion that why should one be concerned with mass immigration into Europe if the new immigrants can mimic the European "ideas and ideals". Let's ignore the fact that 1) the new immigrants are far from "a bit" and 2) they have clearly shown they have no interest in anything European aside from the monetary and safety perks that is afforded them. Also, one must never forget that it is the European who came up with "European ideas and ideals". If these ideas are some amorphous concept that anyone can master with the right "recipe", then we should have seen these "ideas and ideals" spawn all over the globe, should we not? If not spontaneously spawn, how about catch on by example from us? We see pitiful neither in actuality. What we will see is NON-European ideas and ideals become the norm and the rule of law once Mr. Doney's (and Mr. Clinton & Donhue's) dream of blue eyed blonde eradication occurs. Really, do we not have enough examples of this that we need more and on a larger scale?

Tax bonus for parents

Submitted by Pelle Eriksson (not verified) on Sun, 2006-01-15 11:39.

It's only one problem with all these ideas about how to increase the birth rate i.e. they won't work ! European culture & demographics are already deep into the death spiral and it is impossible to reverse the trend of declining birth rates, the most likely scenario is that the birth rate will continue so slide towards 1 child per women thus further speeding up the extinction process!Historically it is also logical that pessimistic, saturated & self-loathing cultures don't survive

humbug

Submitted by dof (not verified) on Sat, 2006-01-14 09:31.

I would expect this kind of nonsense from socialists.

First you have a pension scheme based on repartition, and if you run into problems because of changes in demographics, you try to "control" the demographics.

It makes a lot more sense to have individual responsibility for pensions, so that your system isn't that dependent on changes in demographics.

Just curious whether, when

Submitted by Cogito on Sat, 2006-01-14 15:28.

Just curious whether, when the repartition pension system was voted, there were objections from more conservative politicians foreseeing exactly the problems we see with it now?

The Birth Dearth

Submitted by Lou Minatti (not verified) on Fri, 2006-01-13 22:07.

I've suggested this repeatedly on my blog and elsewhere. I even wrote to my elected representative, but never heard back.

Rather than complicated tax credits or tax breaks, why not index government pensions by number of children raised?

The #1 reason people don't have children is money. It is tremendously expensive. When people have children, they are giving up years of "savings power", time they could be socking away money for retirement. In the US, and probably Europe as well, those with children are very concerned about growing old and not having any money.

People with no children can much more easily save personal funds for retirement.

So index the pension/social security plans. Everyone starts off with a base pension of x amount per month. For every child that person has, increase that pension by 50%.

I think this is fair. The people having children are the ones making sacrifices for the future. Their children will be the ones paying into the pension.

Sorry, a 5% tax credit won't make up for the decades of lost savings power a child-rearing couple could have had. Ensuring a decent pension at the end of the road will make up for it.

Breeds - dying and otherwise

Submitted by Bob Doney on Fri, 2006-01-13 20:54.

Of course all this preposterous nonsense is predicated on one fallacy - that there is a "European" race which needs to be preserved. Come on, Martin, spit it out! You mean WHITE. Do they also have to have blue eyes and unhooked noses as well?

In my judgment the sooner everyone is a shade of mid-brown with slightly curly hair, the better. Then perhaps we can concentrate on being nice to each other and applying our resources, time and reason to more pressing issues. Like the eradication of want, ignorance, poverty and disease.

Bob Doney

statism no racism

Submitted by Cogito on Fri, 2006-01-13 22:27.

To Bob Doney:

The suicide of a society is indeed what is at stake, but this article is an example of a statist reaction to that, and not a racist.

I think there is nothing wrong with having a preference for blonde people with tip tilted noses, and it sure has nothing to do with racism, which is, in my eyes, doing (D-O-I-N-G (verb)) harm to people for the sole reason that they are of another race than yourself i.e. the killing of a white man by a black man just because he hates whites.

Wishing to mix up people to eradicate all racial difference, that could be interpreted as a racism-inspired thought. Aren't all these racial differences beautiful, after all? Don't they contribute to a diverse humanity (while I hate the word diversity since it stands for the same kind of fascist social engineering as childlessness tax - and it comes from the same ideology)?

If one difference that leads to wars is eradicated, don't people then just start other wars because of other differences?

Eradication of want, ignorance, poverty and disease is best left to capitalism, free trade, and plain freedom as our conviction is here, isn't it?

This article seems to move us to who we really are, for a fact.

(But I want to add that you are entitled to dreaming of a brown-tinted curly-haired humanity as long as you don't want the state to impose this, or hate others for having other esthetical insights)

Racism

Submitted by Bob Doney on Sat, 2006-01-14 05:06.

I think there is nothing wrong with having a preference for blonde people with tip tilted noses, and it sure has nothing to do with racism

Oh, come now! I think it might have a teensy weensy bit to do with racism. It's not a very long step from "I prefer blonde, white people" to thinking that brown people are in some way inferior. And why is there is all this apocalyptic talk about the "suicide of a society" just because some people move from one part of the world to another. If the European ideas and ideals are really valuable, don't you think they will withstand a bit of migration and mixing?

Bob Doney

Rome, Peru, Mexico

Submitted by Cogito on Sat, 2006-01-14 09:08.

"If the European ideas and ideals are really valuable, don't you think they will withstand a bit of migration and mixing? "

Have you asked the Aegyptians, the Romans , the Inca's and the Aztecs the same Question?

The Question

Submitted by Bob Doney on Sat, 2006-01-14 16:39.

Have you asked the Aegyptians, the Romans , the Inca's and the Aztecs the same Question?

So what were the Big Ideas that made it a shame that these civilisations didn't survive? Building giant pyramids which MIGHT give the Big Man and His Wife eternal life? Temples running with the blood of human sacrifice? Building cities in the sky to be near the gods with nowhere to grow food?

Now the Romans were different. They went for the Empire thing, and absorbed peoples of all shapes, sizes and cultures into it. And their influence is still with us in our everyday lives. Not bad for a little town in Middle Italy. I still think it was a mistake taking on Christianity as a state religion though. They should have stuck to straight roads, international trade and under-floor heating. Panem et circenses, that's what the punters want.

Bob Doney

The Experiment

Submitted by telder1 on Sat, 2006-01-14 05:54.

The premise of the article was that the tax bonus could be voted in if the people wanted a strong pro-family platform for their country. Thus it's advantages were held forth, with good effect.

So what if Martin's reforms are democratically voted in in a Republic? Should the courts invoke Za Pyet Let as an extra-Constitutional document with which to overturn it (the vote of the voters) and call it justice?

If not, what should the courts use to overturn it and what would be their argument, given that the opposition to the reform would naturally see the courts as their last opportunity to thwart what the people wanted? Could the courts of the Republic argue a pro-family agenda is against EU policy or precedent?

Could a court of the Republic really use extra-Republic rulings or off handed remarks by celebrities from anywhere as an authority to overturn it and still be a Republic where votes actually decide public policy?

--------

Proverbs 16:33 The lot is cast into the lap; but the whole decision is of Jehovah.

In the Name of Jesus Christ, Amen

Social engineering

Submitted by Johan B on Fri, 2006-01-13 20:29.

Shivers ran down my spine when I read this article. Another shiver when I read that Paul Belien seems to like the social engineering of the Soviet Union when it's right up his street.

"Such a system will also eliminate accusations that people with fertility problems are unjustly punished, as was the case with the childlessness tax. They are not punished, but simply pay the normal income tax level. Moreover, people who adopt children will also get the tax reduction."
(...)
Childless people live at the expense of current parents and their children. A tax break for children will balance this injustice."

So, childless people will not be punished, but the "injustice" of not having children will be "balanced" by a tax break. I suppose this is Christian logic?

Bias

Submitted by Paul Belien on Fri, 2006-01-13 23:14.

@Johan B:
When I said "interesting" I meant that it is an interesting fact to know that the Soviet Union had a childlessness tax (something I did not know and would have expected in Nazi Germany, but not in the Soviet Union). It does not imply that I am in favour of such a tax. The fact that you think this because it "is right up my street" is the result of your own shortsightedness and bias.

Short-sightedness and bias?

Submitted by Johan B on Sat, 2006-01-14 16:11.

@Paul Belien:
"When I said "interesting" I meant that it is an interesting fact to know that the Soviet Union had a childlessness tax (something I did not know and would have expected in Nazi Germany, but not in the Soviet Union). It does not imply that I am in favour of such a tax. The fact that you think this because it "is right up my street" is the result of your own shortsightedness and bias."

I said that you "seemed" to like this kind of social engineering.
What do we have here? An article on your weblog that promotes the preservation of "white Europeans" by means of taxation by a meddling state. The author, however, tries to cover up his plea for social engineering by lying about the consequences. "Taxes should not punish people or redistribute wealth", he says.
His conclusion: "Consequently, if a progressive child tax break system were introduced, the sheep would be taken care of while the wolves are fed." With "the wolves are fed" he means that rich people (wolves) have to pay for the children of the poor people (sheep). In my dictionary this is called "robbery". Mark that he promotes an increase of poor white Europeans at the expense of rich white Europeans. Rather a Europe stacked with poverty, than a less crowded rich Europe, he must think.

And what was your reaction? You said Martin gives interesting information, you tell him that Europe already has the social engineering he wishes, but unfortunately "these only cover a fraction of the real costs of children" and you tell him that he is lucky to be an Estonian because in Belgium the proposed "white only" tax system would not be possible.
Well, this seemed to me a very strange reaction for someone who claims to be a libertarian. Sorry for my short-sightedness and bias.

Much more revenue could be

Submitted by Anonymous (not verified) on Fri, 2006-01-13 20:16.

Much more revenue could be raised by having coin operated chasity belts.

cruel

Submitted by Cogito on Fri, 2006-01-13 19:42.

a childlessness tax sounds to me a cruelty and an intolerable discrimination by the state, the only institution that should not discriminate. The family should be a respected entity in which the state is not entitled to involve and that includes the right to reproduce.
If there is something that Europe needs, it is the retrieval of its moral heritage. That will revive Europe's population better and more fundamentally than punishing people for not reproducing.
One could, with more morality, let the payment of retirement depend on whether someone has reproduced or not.
If state retirement payment had been made dependent on this from the beginning, we might be faceing a much smaller problem.
One has never thought this necessary, in the same way as one has never thought it necessary to specifie that marriage is between 1 man and 1 woman, since the latter seemed all too logical, like reproducing was all too natural too. Things however can change as we see.

Far too much truth common sense at once..

Submitted by telder1 on Fri, 2006-01-13 19:24.

... for the 'educated elite'.

It takes a dumb person on a certain level to write that. You are blessed.

..just read this a.m. that "researchers" are baffled that in India, the killing of over 500,000 girls in the womb over a ten year period in favor of having boys is most common among the 'educated'. When it is plain that abortion IS the education the mystery is solved.

Imagine all those 'poor' and 'mis'/'under-educated' souls too stupid to be snobbish about killing their own children.

In the academia of anti-Christ's educational establishment, one can't chase emotional opportunity/'free' will, one can't get away from the non-creating speech/accusations of one's neighbor dragged down by such a burden as real children. And the child only speaks the only speech it has ever heard: what idiot makes a mouth to carry around with them, the speech from which they cannot escape while they long for anything new?

In the past, children were understood to be blessings from God: renewal, new creation. Today, anti-Christ (even as a false 'Christianity') through the 'educated' considers children just one more mouth after the last steak on earth.

A tax (edit: tax break or bonus) would be nice. Jesus Christ as He really is in Europeans such that they are new creations in Jesus Christ is better. With God as Word and Spirit in them, and the certainty in Him that new creation takes place all the time, they would never be prey to the lie that there will never be enough of anything and one must fight and scratch for one's share of supposed limited resources.

Psalm 106:36,37 And they served their idols; and they were a snare unto them: And they sacrificed their sons and their daughters unto demons,

In the Name of Jesus Christ, Amen

Tax on childlessness

Submitted by Paul Belien on Fri, 2006-01-13 18:57.

Interesting. I did not know the Soviet Union had a tax on childlessness.

Many West European countries, of course, already have tax deductions for children and/or child benefits but these only cover a fraction of the real costs of children. 

Just as well, Martin, that you are an Estonian and not a Belgian. In Belgium it is against the law to consider a separate welfare and tax system for citizens and (non-citizen) immigrants, with e.g. a tax deduction for children that would not apply to immigrants who are not Belgian (or EU) nationals. The simple fact of proposing such a system would be considered proof of racism and, hence, a crime.

Also regarding differentiated tax systems

Submitted by Bart Vanhauwaert on Sun, 2006-01-15 15:50.

Many immigrants already have the Belgian nationality.

Regarding this article, the fallacy of course is, as Bob rightly pointed out, that there is no need at all to have more 'European' children. Not sociologically and not economically. Advocating such a position is just putting old style collectivist-nationalist thinking above the individual. And wether structuring it as a tax on childlesness or a tax break for big families, it's still social engineering by state fiat at its best...

I am sorry but I feel little sympathy for people who say having children is too expensive. It's a free choice after all, and expecting the state (ie others) to bail you out, that's just shedding financial responsability at its best. If you want to hedge the risk of having a lot of children, find a private company and persuade it to provide insurance against it. Unfortunatly, even on arguably the most right wing Belgian media outlet with importance, that position seems to have precious little defenders...