Dwight E. Avis, Sr. quote on income tax

A statement from members of his family

Dwight E. Avis, Sr. has been quoted widely by tax dissenters in an effort to support their cause. The statement, removed from its context, is:

"Let me point this out now. Your income tax is 100 percent voluntary tax and your liquor tax is 100 percent enforced tax."

This essay will refute this and quote the proper context of that statement. But first, some background.

Dwight E. Avis, Sr. had two children, Nancy, and Dwight E. Avis, Jr. Both are still alive, and one of Nancy's daughters, BonnieJean, is my wife.

This provides me with a connection to find out not merely the context, but something about the individual, having the family ties to find out.

After sending Nancy Avis (I will use her maiden name, for the purposes of this discussion) a similar text to this essay in 2007, she responded,

"Thanks for noting my father's intentions and, as you know, he would never refrain from paying taxes or suggest anyone else should."

Nancy Avis was about 14 years old in 1953 when the Dwight E. Avis, Sr. quote was made.

Next, let's consider the nature of the federal income taxes at issue:

The Internal Revenue Code (IRC) is law, enacted by Congress, not by the Internal Revenue Service (IRS). The IRS is only the government service agency designated to print the forms and handle the flow of money. The Internal Revenue Code (IRC) dictates, as a matter of federal law, that we owe taxes, and specifies how much we owe.

Many people miss the above point. Blaming the IRS about having to pay income tax is like blaming the meter reader about your gas or electric or water rates, or blaming the town collector for your property taxes, or blaming the police for the speed limits on the road. If you have a problem with the income tax, you must appeal to the Congress of the United States, through your elected senators and representatives, who enacted the tax law. The IRS did not.

Next, the term "voluntary," as used by the IRS and others, is a legal term, to be contrasted with "distraint," and not to be confused with "optional." We owe the tax, but the government is expecting us, the taxpayers, to voluntarily assess our tax liability, fill out the tax forms, and send in the money. The government will not, for example, place liens on our property until we pay, nor will the IRS fill out the forms for us, nor will a "tax collector" come to our door at the beginning of each year demanding to go through our financial records.

Unless you don't voluntarily pay and they find out.

The government depends on this system of "voluntary assessment" because it would be cost prohibitive for the government to do it themselves for each and every taxpayer, by distraint. They are passing the burden of responsibility for income tax assessment to the taxpayer. So, now each of us spends hours and hours of our own time doing our income tax assessment in order to ourselves comply with the Internal Revenue Code, which is law.

The government and the IRS are expecting that everyone will voluntarily assess and pay their taxes but the fact that we owe the taxes is not up for debate. It is a crime, punishable by penalties, fines and imprisonment, to not pay the taxes we owe. And again, that is according to the laws enacted by the United States Congress, the official branch of the U.S. government that has the power to enact laws, and not the IRS. This fact has consistently been upheld by the courts and widely recognized by professors of law in the law schools.

If the "voluntary" system of assessment does not work, due to widespread non-compliance, then we should expect that Congress can and will enact further laws to remedy the problem of non-compliance, or grant the IRS sufficient powers of enforcement, because the taxes are mandatory and not optional, and it is within the government's authority to do so.

BonnieJean's grandfather, Dwight E. Avis, Sr., is being widely quoted out of context by tax dissenters. He was the head of the Alcohol and Tobacco Tax Division of the IRS. He was addressing the House Ways and Means Committee in 1953 concerning problems in that division (this division became what is today known as the ATF), which he blamed on political appointments of "the wrong kind," which adversely affected the division's operation.

During a discussion with the Ways and Means committee about how his division was structured and administered in terms of its personnel, a question came up about how a tax matter might go to the "Appeals Section," at which point he interrupted the questioner, because the question was irrelevant, and then he made the now-famous statement.

The question asked was irrelevant because there was no "Appeals Section." How could a matter about the liquor tax be appealed? Liquor, as we know, is taxed before you buy it. You as a consumer do not voluntary assess the amount of liquor that you consume and then mail your tax to the IRS. There is nothing for the IRS or the government to dispute with you about, and nothing for you to appeal, because the tax was already paid (by distraint) before you bought it. That is why Mr. Avis and his organization only concerned itself with enforcement of the liquor tax.

Here it is again, in a little bit greater context:

Mr. Curtis: I have one more question. What type of alcohol and liquor tax problem would be referred to the Bureau of Internal Revenue generally, and not be confined to and finally disposed of in the Alcohol and Tobacco Tax Division?

Mr. Avis: I do not believe there is any. One of my assistants refers to policy and personnel, and of course, under this new structure, we are concerned here in Washington, as I pointed out, largely with policy and in administering the industry, rather than directing the personnel. That is left primarily to the district commissioners or, rather, the assistant district commissioners.

Mr. Curtis: An alcohol tax matter that would go to the Appeals Section-

Mr. Avis: There is just no such thing. That is where this structure differs. Let me point this out now. Your income tax is 100 percent voluntary tax and your liquor tax is 100 percent enforced tax. Now the situation is as different as day and night. Consequently your same rules do not apply, and therefore your alcohol and tobacco tax has been handled here in this organization a little differently because of the very nature of it, than the rest of the overall tax problem.

Mr. Curtis: In other words, the alcohol and tobacco tax setup, while it is a part of the Bureau generally, has more or less an autonomy of its own, with the power and authority vested in it; is that right?

Mr. Avis: I think that is a fair statement; yes, sir, Mr. Curtis.

There are many frivolous arguments against paying taxes. The idea that Congress would enact a law levying "optional" taxes is silly. Why would they expect anybody to pay "optional" taxes? There are many other frivolous arguments made, involving semantics, personal interpretations of the Constitution, arm-chair opinions as to whether the Sixteenth Amendment was legitimate, or trying to catch the government or IRS at technicalities which have nothing to do with the spirit and intent of the law. The issues are so widely understood, and have been so frequently revisited, that there are now some substantial fines and penalties for bringing frivolous tax arguments to the courts or to the IRS.

Again, the colleges of law and their professors, the courts, and the legislators agree: You owe the income tax specified by the Internal Revenue Code. If you don't voluntarily pay it, the government does have the authority to force you to pay it, and convict you of criminal tax evasion.

Now let's take a Christian perspective on the law:

Romans 13 states "if you owe taxes, pay taxes." The Internal Revenue Code that Congress enacted as law defines the taxes that we owe, before the existence of a government service agency like the IRS is even brought into consideration. Non-payment of these taxes is therefore rebellion against the government authority that we live under.

Beware of the motives of those endorsing tax evasion, "for the love of money is a root of all kinds of evil." (1 Tim 6:10) If, on the other hand, you trust God for his provision, then God will provide the necessary finances, as even Jesus himself demonstrated when he paid a two-drachma tax that he rightly reasoned and demonstrated in principle that he didn't even owe, as he said, "...ινα δε μη σκανδαλισωμεν αυτους..." ("...in order that we not [Strong's G4624, "skandalizo," from which we get the English transliteration "scandalize"] same..."), in Matt 17:24-27.

The following is a much greater context of the Dwight E. Avis, Sr. quote:

Internal Revenue Investigation
Hearings before a subcommittee of the Committee on Ways and Means
House of Representatives
Eighty-third Congress
First session on Administration of the Internal Revenue laws
Part A

Thursday, February 3, 1953

[opening statements omitted]

Chairman Kean: Will you come up, Mr. Avis? Mr. Avis, will you identify yourself for the record?

Mr. Avis: Mr Chairman, my name is Dwight E. Avis. May I proceed, Mr. Chairman?

Chairman Kean: And your position?

Mr. Avis: Head, Alcohol and Tobacco Tax Division, Bureau of Internal Revenue.

Chairman Kean: Will you proceed.

Mr. Avis: Mr. Chairman, since November 13, 1951, first as Deputy Commissioner and more recently as Head of the Alcohol and Tobacco Tax Division, I have been responsible for liquor- and tobacco-tax administration. Prior to that date, as Assistant Deputy Commissioner, for more than 15 years I was in charge of the strictly law-enforcement activities of the Division. Mr. Chairman, I regret that the committee has found conditions in the Alcohol and Tobacco Tax Division which have necessitated a public hearing. There is an old adage that politics and liquor don't mix. That is just as true of politics and liquor-tax administration. In my judgment, the present ills of the Alcohol and Tobacco Tax Division can be attributed to politics, the wrong kind of appointments. I do not want to interfere with counsel's orderly presentation, but I do want it understood that, if the committee desires, I am prepared to return and discuss this subject.

Chairman Kean: Do you mean, Mr. Avis, that you feel that politics has interfered substantially with efficient administration in your Division?

Mr. Avis: I do, sir; and I think, in fairness to the persons to whom I would have to refer, that that is a matter on which the committee should first hear me in executive session.

Chairman Kean: Mr. Avis, as chairman of this subcommittee, I want to commend you for the courage and sincerity which prompted the statement you have just made, and for your offer of cooperation. We certainly want you to discuss with us the matter of politics in the Alcohol and Tobacco Tax Division. I certainly agree with you that we should consider it in executive session first. However, I think now the subcommittee must learn something about your Division and its responsibilities, so that we can better understand the adverse effects of mixing politics and alcohol-tax administration. After we adjourn today, I will be glad to try to arrange with you and the committee a time when we may pursue these matters further.

Mr. Curtis: Mr. Chairman, at that point, could I ask a general question? In reference to this problem of politics, it it confined to the matter of selection of personnel, or did you have in mind some matters that the committee might inquire into dealing with actual tax cases?

[Several pages of testimony continue]

Mr. Curtis: So in comparing the number of men in the top echelon who would supervise the people in the field, that varies from district to district?

Mr. Avis: That is true. In some districts where we do not have very much of a permissive problem, we would not have as many permissive supervisors.

Mr. Curtis: What is a permissive problem?

Mr. Avis: That is your tax problem, your regulatory problem, your regulation of your industry; that is what we refer to generally as the permissive side, that is, distinguished from the law enforcement.

Chairman Kean: They are classified differently?

Mr. Avis: Depending on the job they do. For example, take in the Denver district and the Seattle district, the problem there does not correspond to the Louisville district, for example, which is a large distilling center, and in Indiana and Kentucky, and consequently they are not graded as high.

Chairman Kean: You still have the same title, but not the same grade and salary?

Mr. Avis: That is right, sir.

Chairman Kean: And the staff is much smaller in one area than in another?

Mr. Avis: Much smaller, and that applies to rank and file, of course, as well as to intermediate supervisory positions.

Chairman Kean: The only reason some of these areas exist are for geographical reasons, and otherwise you would probably make it a lot bigger to cover more territory; but for geographical reasons you have to bunch them close together, some of the smaller ones?

Mr. Avis: That is true, sir.

Mr. Curtis: I have one more question. What type of alcohol and liquor tax problem would be referred to the Bureau of Internal Revenue generally, and not be confined to and finally disposed of in the Alcohol and Tobacco Tax Division?

Mr. Avis: I do not believe there is any. One of my assistants refers to policy and personnel, and of course, under this new structure, we are concerned here in Washington, as I pointed out, largely with policy and in administering the industry, rather than directing the personnel. That is left primarily to the district commissioners or, rather, the assistant district commissioners.

Mr. Curtis: An alcohol tax matter that would go to the Appeals Section-

Mr. Avis: There is just no such thing. That is where this structure differs. Let me point this out now. Your income tax is 100 percent voluntary tax and your liquor tax is 100 percent enforced tax. Now the situation is as different as day and night. Consequently your same rules do not apply, and therefore your alcohol and tobacco tax has been handled here in this organization a little differently because of the very nature of it, than the rest of the overall tax problem.

Mr. Curtis: In other words, the alcohol and tobacco tax setup, while it is a part of the Bureau generally, has more or less an autonomy of its own, with the power and authority vested in it; is that right?

Mr. Avis: I think that is a fair statement; yes, sir, Mr. Curtis.

Chairman Kean: How about legal matters; does the counsel of the Bureau advise with you?

Mr. Avis: Well, we have an Alcohol and Tobacco Tax Division counsel, and he reports to the Chief Counsel of the Bureau, and he is part of the general counsel's setup in the Treasury. But for convenience, so that when I get a problem, for example, over the telephone and it is a question of whether a big factory or a plant's operations are to be set up, I can grab my lawyer across the hall and find out what the law is, don't you see; and he, for convenience, is located right in the adjoining suite to me here in Washington. And the same thing applies in the field. In other words, it is a specialized field, and the lawyers that service alcohol tax are generally attached to the assistant district commissioner's office, as far as space is concerned. They still report to their boss, who is the divisional counsel.

Chairman Kean: There is a lawyer in every one of the 17 areas?

Mr. Avis: Yes.

Chairman Kean: He is under the lawyer who deals with you, who is under the man in Mr. Davis' office at the moment, who is under the man in the Treasury Department?

Mr. Avis: That is Mr. Tuttle; I think he is the new man.

Mr. Curtis: But your lawyers are confined to problems relating to alcohol tax and tobacco tax?

Mr. Avis: Yes; because it is so highly specialized, sir. Mr. Chairman, I think we have covered the rest of my statement, but I will read it. The reorganization plan abolished the district supervisors and established in their place 17 assistant district commissioners, Alcohol and Tobacco Tax Division, who, subject to the general supervision of the district commissioners, have substantially the same functions, powers, and duties that the former district supervisors had. All the tax and regulatory field functions, including the servicing of the industries...

[testimony continues]