You're dodging the essence of the question. Give us one real world example of a case where tax evasion has been A Good Thing.
yummyfajitas, it frankly sounds like you're econtrolling. I looked at your profile and you seem like a smart, educated person, so I'll respond in good faith so you can see how weak your arguments sound.
> Taxes are compulsory only to prevent freeloading
Says who? This sounds like a stylised model from Econ 101.
> A tax shelter is only inefficient if it allows a company to consume services while forcing others to pay for them.
Prove it.
> Amazon doesn't enjoy the benefit of the CT state police.
I don't use the Merritt Parkway but that doesn't mean I don't owe tax on it.
> Pareto efficiency is a purely theoretical construct.
This from someone who just boiled the entire political economy of Connecticut down to a prisoner's dilemma?
> If a company does not consume those services, it is inefficient to force the company to pay for them.
What is your reasoning?
Perhaps you are sharing these thoughts before giving them a sound-check? I don't mean to be rude but what you're saying doesn't make sense coming from someone of your educational background.
First of all, you are conflating tax avoidance (taking actions to avoid tax liability) with tax evasion (lying to the tax authorities about your liabilities).
In the real world, one efficient "tax shelter" is Amazon locating itself outside of CT. If Amazon were to pay taxes to CT, then CT would produce the public services necessary to support Amazon. Since Amazon is not located in CT, this would be wasteful. Thus, Amazon locating themselves outside of CT and avoiding CT taxes is A Good Thing.
[edit: you appear to have edited your post extensively after I responded to it. It's generally polite to indicate when you do this.]
Can you give a real example of a case where this has actually happened? (by marginal utility I assume you mean marginal revenue; governments do not have utility)
No I mean marginal utility. Governments have utility. For example, they do things like give people money to maintain roads. The marginal utility of higher taxes would be the value of the extra amount of road maintainance, and all other changes to the physical universe, that happens as a result. (Edit: So compare the universes where the government rakes in $x and $x+epsilon of revenue. Which is a better universe? There are plenty of governments where $x+epsilon would produce a worse universe. It might depend on who it gets the extra epsilon from.)
Utility is only defined for individuals. It sounds like you're trying to talk about how some sum of citizens' utility functions changes as a result of a change in government spending.
Response to your edit: you haven't defined "better". And I'm still waiting for a real world case where $x+$epsilon has been dominated by $x.
First you have to define what "better" means since there are O(300 million) utility functions in the U.S.A.
Second, I want a real-world example of a "negative marginal utility" of taxation -- which tax rate was raised, who it affected, how they evaded it, and why it was good for the society at large.
I'm sure if you're dissatisfied to my answers then you'd have no problem coming up with some of your own examples.
Edit: Wait, you want me to define a utility function for people? That was your first question? That's just a stupid question. Define your own utility function. I don't care what it is. And your second question is stupid too. Sorry, I'm not a keeper-tracker of tax evasion. So let's say "any time a poor person evades taxes." Or many of those cases. If you want a specific example, too bad. If the lack of a specific counterexample of the kind you specified is actually the barrier preventing you from changing your opinion about this, then you shouldn't bother trying to have opinions about things. The fact that some people get more value in government services than they pay in taxes is proof that there are people whose tax evasion would benefit society at large. This is a simple mathematical truism.
> I'm sure if you're dissatisfied to my answers then you'd have no problem coming up with some of your own examples.
I was challenging you on this point because I don't believe you can come up with an actual example of a company's tax evasion benefiting society.
> Wait, you want me to define a utility function for people?
No, I wanted to prompt you to think about defining a single utility function for 300 million people. There is no way to do it, because you cannot compare interpersonal utilities. Your statements about governments having utility suggests that your thinking on this topic is muddled.
> If you want a specific example, too bad.
No empirical evidence, then?
> The fact that some people get more value in government services than they pay in taxes is proof that there are people whose tax evasion would benefit society at large.
It would not benefit society at large; the benefits would be private to the evader and everyone else's tax bill would go up.
> This is a simple mathematical truism.
Not only is it false, but I don't think you know what a truism is. A truism is a tautology.
> stupid ... stupid ... you shouldn't bother trying to have opinions about things
SamReidHughes, there is a saying that to know a little economics is worse than to know none at all. I think you are overconfident in your theories and should be more humble and polite in dialogue with others.
yummyfajitas, it frankly sounds like you're econtrolling. I looked at your profile and you seem like a smart, educated person, so I'll respond in good faith so you can see how weak your arguments sound.
> Taxes are compulsory only to prevent freeloading
Says who? This sounds like a stylised model from Econ 101.
> A tax shelter is only inefficient if it allows a company to consume services while forcing others to pay for them.
Prove it.
> Amazon doesn't enjoy the benefit of the CT state police.
I don't use the Merritt Parkway but that doesn't mean I don't owe tax on it.
> Pareto efficiency is a purely theoretical construct.
This from someone who just boiled the entire political economy of Connecticut down to a prisoner's dilemma?
> If a company does not consume those services, it is inefficient to force the company to pay for them.
What is your reasoning?
Perhaps you are sharing these thoughts before giving them a sound-check? I don't mean to be rude but what you're saying doesn't make sense coming from someone of your educational background.