Turning first to their basic contention, indeed the one on which all the others rest, that the relation of domestic employment does not come within Art. 1, Section 8, and is therefore immune from the imposition of federal taxes and burdens, we find ourselves in no doubt that appellants are neither historically nor etymologically correct in their claim in substance that excises are limited to taxes laid on the manufacture, sale or consumption of commodities within the country, upon licenses to pursue certain occupation and upon corporate privileges only. It is true that taxes of the kind referred to are excise taxes but it is also true, as was held in Steward Machine Co. v. Davis, that the excises which Congress has power to impose are not limited to vocations or activities which may be prohibited altogether or to those which are the outcome of a franchise, but extend to vocations or activities pursued as of common right. The term ‘excise’ is and was before and at the time of the adoption of the Constitution a term of very wide meaning. Abney v. Campbell, 206 F.2d 836, 841 (5th Cir. 1953), cert. den. 346 U.S. 924 (1954).
[Hamzik] contends only that he does not have a tax liability and subsequent deficiency because all federal income taxes are ‘indirect taxes’ and the Commissioner has not produced the statutes defining the ‘revenue taxable activity’ that would make Hamzik subject to or liable for any tax under Title 26. The tax court properly rejected Hamzik’s arguments as frivolous. Hamzik v. Commissioner, 25 Fed. Appx. 911, KTC 2001-589 (9th Cir. 2001), (affirming the decision of the Tax Court and imposing sanctions of $250 for bringing a frivolous appeal).
Furthermore, Olson’s attempt to escape tax by deducting his wages as ‘cost of labor’ and by claiming that he had obtained no privilege from a governmental agency illustrate the frivolous nature of his position. This court has repeatedly rejected the argument that wages are not income as frivolous, [citations omitted] and has also rejected the idea that a person is liable for tax only if he benefits from a governmental privilege. Olson v. United States, 760 F.2d 1003, 1005 (9th Cir. 1985).
All individuals, freeborn and nonfreeborn, natural and unnatural alike, must pay federal income tax on their wages, regardless of whether they have requested, obtained or exercised any privilege from the federal government. United States v. Sloan, 939 F.2d 499, 501 (7th Cir. 1991), cert. den. 112 S.Ct. 940 (1992).
Plaintiff appears to argue that according to the Sixteenth Amendment, federal income tax is not a direct tax on wages or salaries of individuals, but that it is an excise tax on the privilege of engaging in some privileged or regulated activity. Therefore, according to plaintiff, this ‘indirect excise tax’ can only be imposed on the income of corporations and the dividend income of stockholders. Despite plaintiff’s many case citations allegedly supporting his argument, the Sixteenth Amendment, valid as described above, clearly authorizes Congress to levy a direct income tax upon individuals who are United States citizens. In addition, as described above, plaintiff’s wages and gambling earnings are clearly within the I.R.C.’s definition of ‘income,’ and are properly subject to taxation. Betz v. United States, 40 Fed.Cl. 286, 294-296 (1998)
The IRS is not required to show that the Debtor’s income is derived from a ‘revenue taxable activity.’” In re: Michael Fleming, 86 AFTR2d ¶2000-5138; No. 97-6342-8G3 (U.S.Bank.Ct. M.D.Fl. 8/9/2000).
[Peth] argues that he is not a “person liable” to pay taxes under 26 U.S.C. § 6001. The argument is this: the tax imposed by Title 26, according to plaintiff, is “not unapportioned direct tax,” because any such tax ‘would be in conflict with the apportionment restriction of direct taxes contained in [Article I of the Constitution].’ Moreover, he finds that there are no apportioned taxes imposed by Title 26. Thus, any tax under Title 26 must be an indirect tax, that is, a tax upon some right, privilege, or corporate franchise. Plaintiff says he is not a privileged person, nor has he taken any corporate franchise. Therefore, so the argument goes, Title 26 has no application to him. The argument has no merit. Peth v. Breitzmann, 611 F. Supp. 50, 53 (E.D.Wis. 1985), 1985 U.S. Dist. LEXIS 21509, 85-1 U.S.T.C. ¶9321, 55 AFTR2d 1280 (complaints dismissed and sanctions imposed for filing frivolous actions “brought in bad faith”).
[P]etitioner argues that the income tax is an excise tax and that petitioner did not engage in any taxable excise activities during 1996, 1997, and 1998. The contentions made by petitioner in his petition and on brief are appropriately termed ‘tax protester rhetoric and legalistic gibberish’, and we shall not dignify such arguments with any further discussion. Heisey v. Commissioner, T.C. Memo. 2001-41 (tax deficiencies affirmed, along with penalties for failure to file and failure to pay estimated taxes, and an additional penalty of $2,000 was imposed for filing a frivolous petition), aff’d 2003 TNT 66-47, No. 02-72675 (9th Cir. 3/20/2003), ($1,500 penalty imposed for filing a frivolous appeal).
Petitioner argues that the income tax is an excise tax and that he did not engage in excise taxable activities in 1996. [Note 3: “Petitioner testified: ‘The income tax is an excise tax. Congress, who sets the laws, even says so in the Congressional Record. The income tax is therefore not a tax on income.’”] We shall not painstakingly address petitioner’s assertions ‘with somber reasoning and copious citation of precedent; to do so might suggest that these arguments have some colorable merit.’ [Citation omitted.] Accordingly, we sustain respondent’s deficiency determination. Sawukaytis v. Commissioner, T.C. Memo. 2002-156 (sanctions of $12,500 imposed), aff’d 102 F.App’x 29, 2004-1 USTC ¶50,283, KTC 2004-186, Docket No. 02-2431 (6th Cir. 6/16/2004), (additional sanctions of $4,000 imposed for filing a frivolous appeal; the original tax in controversy was $13,976, plus a failure to file penalty of $726, so the total of the sanctions imposed by the Tax Court and Circuit Court exceeded the original amount in controversy), rehearing den. 8/6/2004, cert. den. No. 04-587 (12/6/2004).
In Pabon v. Commissioner, T.C. Memo 1994-476, the petitioner alleged, among other things, that he “is not an employee of the Federal or state governments, is not engaged in a revenue taxable activity of alcohol, tobacco or firearms and therefore not subject to any exise [sic] tax....” The court concluded that the petition “is nothing but tax protester rhetoric and legalistic gibberish....” Pabon v. Commissioner, T.C. Memo 1994-476.
