Taxes: The Right Not to Overpay

Many people assume that paying taxes means giving the state as much as possible. This paper challenges that assumption. It draws a clear distinction between paying taxes that are legally owed and unnecessarily organizing one’s life, business, investments, or assets in a way that creates the highest possible tax burden.

The central idea is simple but powerful: everyone must pay the taxes that legally arise. But no one is required to arrange their residence, company, investments, ownership, income, or financial structure in the most tax-expensive way available.

The paper develops the concept of fiscal self-sovereignty. This means the legal capacity of citizens, entrepreneurs, investors, self-employed professionals, and corporations to organize their financial and legal affairs intelligently within the boundaries of the law. It is not about tax evasion, concealment, false reporting, or artificial structures. It is about lawful planning.

Taxes do not arise simply because a person has money, earns income, or owns assets. Taxes arise because the law attaches consequences to specific facts: residence, source of income, ownership, timing, sale, distribution, company form, financing method, jurisdiction, classification, or taxable event. Once this is understood, tax planning becomes clearer. Tax is not only a question of how much one earns. It is also a question of how legal facts are structured.

For example, selling an appreciated asset may trigger capital gains tax. Keeping the asset may not. Receiving dividends may create one tax result, while retaining profits in a company or using genuine debt financing may create another. Living in one country may create worldwide tax exposure, while lawfully changing residence may change the entire tax position. Choosing one legal form for a business may produce one result, while choosing another lawful form may produce a different one.

The key distinction is this: a tax that never legally arose cannot be evaded.

However, the paper also emphasizes strict boundaries. Lawful tax planning is only defensible when it is real, documented, transparent where required, economically genuine, and free from deception. Fake residence, hidden ownership, sham companies, fictitious loans, false contracts, or concealed income do not belong to fiscal self-sovereignty. They belong to illegality.

The paper therefore rejects a common moral oversimplification. Paying taxes is a legal duty. But that duty does not mean fiscal self-sacrifice. The state may claim what the law validly creates. It may not demand that taxpayers voluntarily choose the most expensive lawful arrangement merely because it would generate more revenue.

One of the paper’s strongest points is the idea that fiscal ignorance is not a civic virtue. A taxpayer who pays more because of poor structuring, unnecessary residence, premature realization, inefficient ownership, or lack of knowledge is not necessarily more ethical. Often, that person is simply less informed. Paying more than legally required is not automatically morality. It may simply be avoidable loss.

This perspective is especially relevant for entrepreneurs, investors, self-employed professionals, internationally mobile individuals, and corporations. Their tax burden often depends on how work, residence, ownership, corporate structures, financing, intellectual property, dividends, capital gains, and investments are organized. The same economic activity can lead to different tax results depending on the legal structure around it.

The paper also shows that legal tax saving is not an outsider practice. States themselves create tax incentives, special regimes, investment zones, territorial tax systems, corporate forms, holding structures, treaty networks, research incentives, and preferential rules. If legal systems create these options, their genuine and compliant use cannot automatically be treated as morally suspicious.

At a deeper level, the paper defends the taxpayer as a legal subject, not a passive revenue object. A mature legal person is not only someone who can be taxed, punished, regulated, and held liable. A mature legal person must also be recognized as capable of planning, choosing, structuring, and protecting property within the law.

The right not to overpay is therefore not a right against taxation. It is not a rejection of law. It is the right to use the law intelligently.

Fiscal ignorance is not a civic duty. Poor structuring is not a moral obligation. Legal tax saving, when it satisfies legality, substance, documentation, disclosure, economic reality, and the absence of deception, is not tax evasion. It is lawful self-organization.

The full scientific article is available in the International Journal For Multidisciplinary Research

Elias Rubenstein (2026): The Right Not to Overpay: Fiscal Self-Sovereignty and the Lawful Non-Creation of Taxable Facts
DOI: in process

Elias Rubenstein: The Right Not to Overpay: Fiscal Self-Sovereignty and the Lawful Non-Creation of Taxable Facts.pdf