Jesus dealt with the tax issue when confronted by the Jews.
They hoped to catch Jesus in something he said so that they might hand him over to the power and authority of the governor. So the spies questioned him: "Teacher, we know that you speak and teach what is right, and that you do not show partiality but teach the way of God in accordance with the truth. Is it right for us to pay taxes to Caesar or not?"He saw through their duplicity and said to them, "Show me a denarius. Whose portrait and inscription are on it?" "Caesar's," they replied. He said to them, "Then give to Caesar what is Caesar's, and to God what is God's." They were unable to trap him in what he had said there in public. And astonished by his answer, they became silent. (Luke 20:20-26).
This incident has caused considerable confusion.
The usual interpretation is that Caesar's image and name on the coin proves that he owns it, so it must be given back to him if he asks for it. This is economic nonsense. An image on a coin proves nothing. New Zealand five dollar notes have a picture of Edmund Hilary, the first person to climb Mount Everest. To suggest that he owns every five dollar note is absurd.
The coin that Jesus looked at belonged to the person who had given it, unless it was stolen, and then it belonged to the person it was stolen from. It did not belong to Caesar. If Jesus had given the coin to a soldier and asked him to return it to Caesar, the person who had given it to Jesus would have been upset.
Jesus commanded the people pay to Caesar what they owed him. Caesar had provided a service by minting the coins, but this was a profitable exercise, because kings did not put the full value of the silver or gold in the coin. When a new coin was issued, the difference between the value of the gold or silver in the coin and the face value of the coin was profit for the kings, so the people who used the coins owed him nothing for that service.
Rome may have provided roads that were beneficial to local communities, but the people often had to supply forced labour to build them. Caesar had not defended the people of Israel, so they owed him nothing for defence.
The image of Caesar on the coin was contrary to the second commandment. By putting his image on a coin, Caesar was rebelling against God. Jesus was reminding the people that Caesar was the enemy of God outside his covenant with Israel. They should not render anything to him.
By way of contrast, everything belongs to God, so we must submit everything to him. Jesus had declared over and over again that all authority belongs to God. Even the Son of God must submit to the authority of God. Since all authority belongs to God, we must submit to God in everything. This applies to Caesar as well as to ordinary people. Caesar must give to God everything that belongs to him. A political power cannot be above God
Jesus' statement about giving to Caesar has been used to develop a theory that Jesus rules the church and the spiritual life and that political powers control the political and economic dimensions of life. This is nonsense. Jesus could not assign authority over the political dimension to Caesar, because all authority belongs to God. He could not give authority to make laws to political dictators or parliaments, because God is our lawmaker and has already given us the law that we need. God is not interested in power-sharing with Caesar, or any of his successors.
When Jesus said to give Caeser what belonged to him, he was not giving Caesar authority over secular life. He was not legitimising political power. He was simply restating the biblical principle that stealing is wrong. If the people owed something to Caesar, they owed him payment. If he had taken more than he had given, they owed him nothing.
Jesus told people to "give" Caesar what they owed him. He did not say paying taxes was compulsory. Giving is a voluntary concept. If something is taken by force, it is not given. If someone steals your car, you do not say, "I gave it to the thief". We must choose to give, or it is not giving. Jesus told us to give what we owe to Caesar. This confirms that he was talking about something voluntary and not compulsory payment of taxes. Jesus was teaching that all payments to the state should be voluntary.
