Tuesday, September 6, 2011

A Legal Dichotomy: Prostitution and Income Tax


Prostitution is legal in Germany. In the city of Bonn, 'sex meters' have recently been installed to make it easier for sex workers to pay income taxes, as part of a nationwide attempt to reduce public debt. Retrieving government revenue from street sex workers has been difficult in the past because of the difficulty in locating the workers as well as communicating with them, as many of them are foreigners.

If prostitution is a legal industry, it should also be income taxable. 'Legal' and 'taxable' are both statuses that are ascribed by the government; therefore the government has the power to decide whether prostitution is legal and/or taxable. Although the cause-effect relationship is not clear in this case between the legalization of prostitution and the institution of income taxes for sex workers, the two issues are inevitably interconnected. This connection becomes more poignant in a time of national economic crisis. Should governments be allowed to legalize prostitution so as to make it income taxable, or to use taxation as a justification of prostitution, thereby making government money from this industry, which in turn can help the nation in a time of economic recession?

This is very much a logic and reason-based issue. The city of Bonn expects 200,000 euros ($288,000) yearly from the new system. To remedy national debt, any contribution of this nature is helpful to the government. If one city uses the 'industry' of prostitution to repair national debt, other cities, and other nations, may also see income tax as a justification for the legalization of prostitution. It is 'logical' for this to occur. A language issue is also at hand, regarding whether or not prostitution is an industry at all, and therefore income taxable. Although the issue at hand is not whether or not prostitution itself should be legalized, the city of Bonn is not discouraging this institution, which is so harshly discouraged elsewhere in the world, by providing sex workers a means of paying their taxes, just like any other working man/woman, anywhere.

The most important areas of knowledge in this issue are ethics and the human sciences; in this particular case, the moral responsibilities of governments. Is a government encouraging the sex trade by making it income taxable? Is it morally wrong for the government to legalize prostitution, if it is in fact beneficial in remedying public debt, and therefore beneficial to the nation on the whole? On the one hand, the city of Bonn is by no means discouraging sex work. Most nations today condemn sex work as immoral. In many cases prostitution is associated with the sex trade, which is an institution that is even more nefarious. The government is, in fact, seizing the opportunity to collect income tax. If one considers the industry of prostitution to be, in fact, a legitimate industry, then the government is most certainly correct in collecting taxes when taxes are due. On the other hand, if the city of Bonn and the nation of Germany have legitimized prostitution for this purpose alone, there is a large ethical issue at hand. It seems unethical, in a worldly sense, for the nation of Germany to encourage an industry that has been so unfortunate and problematic in other parts of the world.

Issues with a greater, real-world application can be drawn from this case. Are governments in general morally responsible, just as individuals are morally responsible? Furthermore, what is the 'right' thing to do, in this case? Is it 'right' for the government to do everything it can to eliminate public debt, or should it instead try and eliminate institutions which are often considered immoral, such as prostitution, although such institutions could also be income taxable? In the end, one does not really know what is 'right' and what is 'wrong'. Individuals have a conscience, but governments do not. The government, in theory, should strive to do what is best for the nation on the whole. However, morality itself is an elusive concept, and becomes even more murky when applied to politics.

1 comment:

  1. I think this is an instance where most of us, as human beings, are swayed more by the ethical implications than what our rational side is telling us. We feel that prostitution is something that's inherently "wrong", but that's just from our point of view. Although somewhat romanticized, this novel (邊城) from the IBHL Mandarin curriculum has a section describing prostitution as a source of income through 'manual labor' that's not necessarily more degrading than what merchants do when they sell their wares (brings to mind certain Wall Street figures). I think your point about the government legitimizing prostitution for the sake of raising tax revenue is very well-defined, and I do believe that governments could be held morally responsible just as an individual can be, except it is the government's job to help determine the definitions of what's "good" or "bad". After all, governments are the leaders of the people, and what better way to lead than by example?
    However, I don't completely agree that "governments do not have conscience", and Ithink the decision to legalize prostitution may have had more factors of consideration than tax alone. For example, the problem of wide-spread STDs would definitely harm a nation. By legalizing prostitution, the government can, at the very least, provide the necessary healthcare for these individuals, and if that's the case, then it would make sense to also impose an income tax, as the government needs to expend a portion of their budget to ensure the health of everybody, whether they are part of the industry or not. So, if the government is going to legalize prostitution (or similar industries), and also impose an income tax, the least they could do is to at least explain their rationales behind it and allow the people to respond to it.

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