To start, let’s divide “theft” into two types: moral theft (when your actions of stealing is bad in a moral sense) and legal theft (when an action is considered stealing by the law). Given this distinction, something can be considered a legal theft but not a moral theft (ex: liberating a slave in colonial Americas) and vice versa, there’s moral theft that’s not a legal theft (ex: Nazis seizing properties of Jews).
If there is a law that states someone is obliged to give a portion of their income to the government, then taxation is obviously NOT a legal theft.
But the question about is taxation a moral theft is more interesting. The libertarian arguments saying that taxation is a moral theft is generally twofold.
1. People deserve the money they get because they’ve worked hard for it. What’s wrong with this? This assumes that the market rewards people solely based on their hard work and contribution to society, which is not the case. A hedge fund manager can be paid exorbitantly while at the same time giving less effort than a scientist working on a cure for cancer. Given this, someone who don’t work hard and just happens to have that money (via inheritance, etc.) don’t deserve their money and is justified to be taxed.
2. People are entitled to their property (body, capital, etc.) and everything that came out of it. How do we tackle this point? By questioning is property rights socially constructed or natural (existing independently outside any human conventions and legal codes) If it is socially constructed, then we can simply create another social construct that says “you’re not fully entitled to your property rights” and that’s it.
What’s interesting is on the analysis of “natural” property rights. There are two perspectives on this theory: Right-libertarians says that everyone is entitled to themselves and the fruit of their labor, and someone has a natural right over something if they discover it first and put labor to develop it.
Two rebuttals to deal with this point:
1. This doesn’t justify someone who just happens to have claims to massive amount of resources and letting everyone else starves.
2. People only have a moral claim to their pre-tax income only if the process in which they acquire it is completely free from state intervention, which in 99% isn’t the case. Companies flourish because of state protection and subsidies, individuals have the chance to grow because the state provides free healthcare, etc.
Left-libertarians, on the other hand, claims that everyone is entitled to themselves and the fruit of their labor BUT the natural world cannot be exclusively owned by someone that excludes the moral claims of others. On dealing with this, we can say that if the natural world can’t be exclusively owned by someone, the state is justified to tax if someone disproportionately claims resources than other people. Moreover, the claim of the future people should also be taken into account, leading to inheritance tax.