The slogan “no taxation without representation” immediately summons images of battles, most notably the Boston Tea Party. The phrase was used to rally support for independence of the “colonies” in North America from the United Kingdom. Taxes were imposed, not by local representatives, but rather by the Parliament across the Atlantic in London. “Surely it is only right”, the argument goes, “that if I am to suffer taxation, it should be by those who I elect. As a result, I can voice my disapproval over any taxes through the ballot box”. Taxation only with representation takes seriously the importance of democratic consent. Even for those who reject the idea that “tax is theft”, it is still compelling to argue that issues around taxation should ultimately be regulated by the people. 

The phrase encounters difficulties however almost immediately on application. There are lots of taxpayers who are not represented by those with the power to impose taxes. Let us consider the UK. VAT is imposed on those who purchase (some) goods and services. It is a tax which applies indiscriminately across those eligible to vote and those ineligible. For General Elections in the UK, only UK citizens (and citizens from elsewhere such as Ireland and some Commonwealth countries) who are over the age of 18, registered to vote, resident in the UK (or were in the past 15years) and are not barred by law on account for instance of serving a prison sentence, are entitled to vote. But every non-UK citizen without voting rights and every person under the age of 18 who buys goods and services in the UK which are subject to VAT will pay the tax. Stamp Duty Land Tax is levied simply on the purchase of land. Stamp Duty on the stamping of certain instruments. 

Perhaps it might be said that the phrase works best when considered in respect of direct taxes such as income tax, which is paid by residents on income earned in the UK and abroad. It is also paid by non-residents on income earned in the UK. Residents will not necessarily be entitled to vote – again many UK residents are not citizens of either the UK or Ireland or some parts of the Commonwealth. Income tax is charged on those under 18 also so will fall on even UK citizens without voting rights in Parliamentary elections. So too with those barred by operation of the law, such as prisoners or Peers in the House of Lords. Then of course every non-resident who is not a UK citizen will be subject to tax on income earned in the UK.

It becomes immediately apparent that the relationship between taxation and representation is fragile when eligibility to vote is considered against the power of the State to tax. This should come as little surprise to those interested in tax policy. Prof Wolfgang Schon for instance in his brilliant “Taxation and Democracy” article in the Tax Law Review from 2019 stressed this point. Dr Yvette Lind has been producing some excellent research on the topic also, whilst earlier in June the European Association of Tax Law Professors dedicated a day of the annual conference to issues around taxation, democracy and representation.

The link between taxation and representation becomes even more fragile when the demographics of who actually votes in the UK are considered and compared with those who actually pay the taxes in the UK.  

It is well known that turnout amongst voters increases with age. For the 2015 and 2017 General Elections, turnout ranged from between 40% and 50% among the youngest voters to over 80% among the oldest. 

Tax receipts, however, are drawn more from the younger than the older populations. National Insurance Contributions (NICs) make up around 17% of total UK tax receipts. However, critically, those over 65 are not subject to NICs on earnings. Income tax makes up almost a quarter of tax receipts. Those over 65 make up just over a fifth of income taxpayers (6.6million). Average income tax paid across this group is roughly £3,676, meaning that total income tax paid by the group is £24.26billion. This is quite the sum in absolute terms of course, but it makes up just around 12% of total income tax receipts.

Of course, these statistics on income tax and NICs liabilities are blind to voting entitlements and the exercise of such entitlements – there will be over 65s as well as under 65s who pay tax but are not eligible to vote, or are eligible to vote, but do not vote. But the number of over 65s who are not entitled to vote is eclipsed by those ineligible to vote younger taxpayers (there are around 9.5million foreign born people in the UK and 6.65million of them are between the ages of 26-65). And of course, the likelihood that those over 65 will vote is greater than the likelihood of those under 65 doing so, as already highlighted.

What begins to become clear then is that those who pay less in tax have greater control over government policy than those that do. “Taxation with consent” fails not just at a formal level, but also in substance. Put crudely, we have taxation for the non-represented, and non-taxation for the represented.