If my children inherit from me here in Switzerland it will be tax-free. If I buy myself an expensive SUV, I pay 8.1 percent VAT. If I want to make a gift to an organisation abroad, the recipient (or I) pays a 30 percent gift tax in Switzerland (and maybe even more at destination).

 Recently, I wanted to support an activist movement in Germany with a substantial sum. Giving abroad, however, unleashes a gift tax. I immediately had doubts, because of the 30 percent gift tax. Isn’t it inefficient? Unfair? I want to do good and am penalised by this gift-tax, even more penalized than for buying a harmful SUV!?

This made me think, do I really believe the neoliberal doctrine that the state is inefficient? The extra 30 percent worries me. I hold conflicting views here that prevent me from making calm decisions, and it truly worries me. My options become clear rather quickly. I could not disclose my gift to the German organisation, but that would be (aiding and abetting) tax evasion and therefore illegal. I could also donate it to a Swiss foundation, which would donate it tax-free to the foreign country. That, however, for me would be tax avoidance. I could then even partly deduct it from my taxes, which would also mean tax optimisation for me.

What’s going on here is really rather simple. Donating for causes I believe in comes easily to me. I consider it part of my responsibility to address my excess wealth through giving back. I was born into a privileged family, in a privileged country, and I inherited wealth without contributing anything towards earning it.

But now I realise that I don’t like ‘donating’ to the state, not because it is inefficient, but because the state also supports things that are diametrically opposed to my values. This includes, for example, false incentives through ill-distributed subsidies, and agricultural subsidies without restrictions banning harmful fertilisers. This also includes funding for nuclear power, aviation-fuels, and the promotion of motorways instead of public transport facilities.

A sizeable amount of my 30 percent gift tax goes to projects that I do not want to support. I find this deeply troubling. By donating to the government, I lose control over how my contribution is used. If I evade, avoid, or optimize my taxes, however, I retain control. To me however, avoiding taxes equals harming Government, which means undermining democracy, which then harms society. As a privileged person I often even do not notice that my actions could cause harm.

I realise, that my predicament is the central compromise everyone makes in a democratic society: I share this country, this planet, and my taxes with people who have completely different world views. Many have different priorities, and our liberal democracy requires finding consensus. The judgement ‘wrong’ or ‘inefficient’ only reflects my one-sided view. Others probably find subsidies of this kind sensible and have campaigned in favour of them. That is the democratic process.

The good thing about democracy is, that the extreme and harmful forces can be inhibited and made impossible by a functioning judiciary or a limitation of power. But where the rich undermine the democratic order through avoidance and optimisation, they damage democracy.

Of course, most rich and super-rich people have good intentions by donating, or ‘investing for the good’, even with some tax avoidance or optimisation.  The main difference between the spending of the rich and the spending of the state is transparency. I can demand transparency from the state. One of the reasons I and many others get so frustrated with state spending is that we actually know where it goes, whereas the financial doings of the super-rich remain obscure to us. This means there is much less transparency and no democratic legitimation at all for private spending!

Moreover, the privileged Philanthropist will rather not use her/his wealth to question their privileges. In a democracy however, I can try to use my power as a citizen to advocate for change and for causes that I believe in, even if it means, undermining privileges of the wealthy.

That’s democracy: it’s not perfect. I share my country with people with whom I disagree.  And yet liberal democracy is clearly the best, indeed the only acceptable form of government for me. It can’t be perfect because people aren’t perfect. Of course, we can still improve our democracies and make them more democratic with lottery procedures, referendums, and more education on personal responsibility, etc. We could curb anti-democratic interventions of lobbyists, bought media, corruption and tax-evasion.

Democracy may not be perfect, but in my opinion, it is the most efficient form of government to guarantee the dignity of all. Tax avoidance is easy, but it is harmful. That’s why I pay this 30 percent gift tax (for the recipient), even if I find it very frustrating.

Jan Colruyt is a Belgian-Swiss philanthropist, married and living in Switzerland. His grandfather started a major Belgian retail business and he runs several Philanthropic organisations in Switzerland and Belgium.