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Is Not Paying Taxes Immoral?

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I have made it pretty clear I want to pay as little in taxes as possible. Recently I did a guest post over on MakingSenseOfCents where a few people mentioned they don’t think it is right to not pay taxes.

I understand both sides of the coin.

I am grateful for all those who before me paid taxes to ensure that I had affordable education when I was a child at school, for the decent roads that are in New Zealand and for the public healthcare system. I recently posted about what growing up poor taught me about money and revealed that both my parents relied on welfare when I was growing up, despite them not living together.
I can’t imagine what life would have been like for my invalid father without such benefits, provided by tax payers.

So… Why am I Okay With Not Paying Taxes? 
Firstly, I have no intention of living in New Zealand for the foreseeable future. Although New Zealand is extremely beautiful, I do not feel connected to the country. I feel it is relatively expensive, compared to many other countries I have visited, even including the United States and Spain. Why should I pay taxes when I am no longer using any of the services, even as far as using the roads?

Secondly, none of my income is derived from New Zealand. I have no New Zealand clients; I operate completely independent of New Zealand. If New Zealand exploded I would be devastated, but my business in no way would be changed.

Thirdly, I’ll be a tax resident of somewhere else. When I first decided I wanted to minimise my tax bill, I had thought it might be enough to be a non-tax resident of New Zealand and not become a tax resident of anywhere else and simply pay on tax. While that is possible, it probably wouldn’t stand up to a tax man if he came chasing after me. Instead, I have decided I will most-likely pursue a permanent residency in Panama under the Friendly Nations Visa. Although my personal income that is earned overseas and reported in Panama will be exempt from tax, I will be paying some tax due to the business I will have to create for the visa.

In my case, as I am severing my ties with New Zealand and not using any of the services, I think not paying taxes is moral. If, when I apply to be a non tax resident, my application is granted, then New Zealand has deemed me disconnected enough to not pursue taxing my income. Obviously I will be nervous in the weeks following my departure to find out what my status is, but I think I should be approved as I own no land here and generate no income in the country.

When Is Not Paying Taxes Immoral?
I think that not paying taxes is immoral if you’re breaking the law of any country in order to minimise your tax bill.
I think not paying taxes is immoral if you are operating under the table in a bid to avoid tax.
I think not paying taxes is immoral when you’re using all the country’s services and yet not contributing your fair share.

What I am doing is some clever tax planning while taking advantage of the fact that I am location independent.

To be honest, if my partner never wanted to return to New Zealand I would be quite content spending my days soaking up the sun, drinking out of fresh coconuts and enjoying $5 hourly massages.

If I consistently earned $21,000 a month for every month of the year – I’m not quite at that level, but would like to be – I would save around $70,000 a year in taxes. That’s basically like being paid $70,000 a year to go live in Panama.

So tell me what do you think? Is not paying taxes something you feel is immoral, or given the chance would you like to legally save a considerable portion of your income?

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