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The normal, dictionary definition of "taxation" is "the practice of a government collecting money from its citizens to pay for public services." "compulsory" is not in the definition. There's absolutely no necessity for it to be compulsory, in fact it should not be, as that contradicts the entire concept of a government based on the consent of the governed. Taxation is, properly, a contractual payment due. A proper government should have an explicit contract with its citizens, and allow them to leave the contract at any time. In the case of a rights-respecting government, the payment that is "demanded" by the government is demanded contractually. The contract between citizens and government is special for a lot of reasons, that's why we have a special word for the collecting of funds. The term only applies to the funds collected by the government from its citizens, and can only take a certain form. Donations or lotteries are not a tax, and it's not just a generic "fee" of any kind. Taxation is legally defined policy of government funding that you agree to pay on an ongoing basis. Of course a voluntary contract can be revoked at any time, when the citizen terminates their agreement with the government that's called renouncing one's citizenship, and no further taxes are due. "citizenship" is a term indicating the special relationship between the citizen and the government, which properly should be a voluntary one, based on contract. It is not an arbitrary designation. In the US you are opted-in automatically by birth, and there are fees and restrictions associated with renouncing one's citizenship. I disagree with these policies, I think they are improper, and to some extent definitely unjust. Citizenship should be a written contract that every individual has to qualify for and agree to in writing, and someone should be able to leave at any time without onerous fees or restrictions. But that doesn't change the fact that the US is essentially a government based on the consent of the governed, despite its flaws. One can condemn the individual instances of injustice and work to resolve any ongoing issues within the system without having to "surmise that America is currently in a state of anarchy", or "dedicate one's life to abolishing our wicked 'government' and to exposing those Satanic politicians". In summary, compulsion is not essential to the definition of taxation; there can be such a thing as a government based on the consent of the governed, where citizens are citizens of the government by voluntary, contractual agreement, and the taxes that the government levies (and the penalties applied for not paying them), are agreed to in advance by the citizen, who can terminate the contract at any time. Taxation is not theft, it is consensual. If Netflix is charging your credit card every month and you want them to stop, you can't just declare "I don't consent!", you have to actually go in and unsubscribe. Netflix will stop charging your credit card, and you will no longer be a member who has access to their services. The same principle applies here. If you don't want to pay taxes then renounce your citizenship, and you will no longer be protected by the government. Nobody is forcing you to be a citizen.

According to the Objectivist perspective, would it be immoral to advocate or accept government grants for college-education? I'm talking mainly about need based financial aid, rather than loans or scholarships. These loans aren't given for academic performance, but strictly based on income.

Is there a legal loop-hole that would allow to build a physical or virtual community that can avoid paying taxes ? Let's say "income taxes" ? For example -- a community based on barter ? IRS says that barter is still income taxable. However, is there a legal way to barter in a way that there is no paper trail that IRS can latch on ? Maybe some other tricks? For example, if all members of a community are getting stock of the company, instead of money, and then use the stock as currency, among themselves -- would it still be income taxable? Ordinarily stock must be sold, to be taxed as income. Would this still qualify as barter? Perhaps, the structure can be registered in another country, say offshore zone -- but people can live in their homeland ? If there is no paper trail, and all transactions are in cash, can IRS implement an income tax system in a practical way ? If a loop-hole exists, and we discover it, would the government be able to to issue new laws, closing the community down ? What would it take to issue such new bill or ammendment ?

I keep seeing the Fair Tax and Flat Tax proposals in the news and get confused which is what. Here is a scorecard: http://pafairtax.org/resrcs/FlatTaxFairTaxComparison.pdf Fair Tax wins my favor, for the many reasons listed in the pdf. The Fairtax is the more radical change because it requires repeal of the 16th Amendment to the U.S. Constitution.