Unpublished Disposition, 859 F.2d 924 (9th Cir. 1988)

MEMORANDUM^* 

The Burnetts appeal the district court's order dismissing their complaint for lack of jurisdiction and for failure to state a claim upon which relief can be granted. We affirm.

The Burnetts filed an amended complaint alleged that in exercising their "God-given and constitutional right [s]" to "acquire and possess property" and to "work, earn a living and sustain themselves," they did "not engage [ ] in any 'activity' taxable for revenue purposes and they [were] not 'liable' for the income tax and [were] not 'taxpayers.' " The Burnetts sought a declaration of their "rights and remedies as 'nontaxpayers," "any other and further relief as to this court appears proper and just," and costs.

We affirm the dismissal of the Burnetts' complaint for substantially the reasons set forth by the district court, Burnett v. United States, No. CV-86-1059, slip op. at 2 (D. Haw. 1987) (Order Dismissing Action and Awarding Attorneys' Fees) (reproduced E.R. at 2). We agree with the district court's conclusion that it lacked jurisdiction to grant a declaratory judgment pursuant to 28 U.S.C. § 2201. Section 2201 explicitly provides that the district court does not have jurisdiction to grant a declaratory judgment "with respect to Federal taxes." We also agree with the district court that the Burnetts are not entitled to "any other and further relief" because their complaint failed to state a claim upon which relief can be granted. The substance of the Burnetts' claim amounts to the argument that "wages are not income," which we have repeatedly held does not state a claim upon which relief can be granted. E.g., Wilcox v. Commissioner of Internal Revenue, 848 F.2d 1007-1008-09 (9th Cir. 1988); Carter v. Commissioner of Internal Revenue, 784 F.2d 1006, 1009 (9th Cir. 1986) (citing cases); Olson v. United States, 760 F.2d 1003, 1005 (9th Cir. 1985) (citing cases).

The government has requested sanctions pursuant to 28 U.S.C. § 1912 and Federal Rule of Appellate Procedure 38. The government seeks damages of $1,500 in lieu of costs and attorneys' fees. We have "discretion to impose damages as a sanction for bringing a frivolous appeal. An appeal is frivolous if the result is obvious, or the arguments of error are wholly without merit." Wilcox, 848 F.2d at 1008-09. Under our decisions the Burnetts' "wages are not income" argument is wholly without merit and the result in favor of the government is obvious. We therefore exercise our discretion and grant to the government damages in the amount of $1,000 as a sanction for filing a frivolous appeal. See id., 848 F.2d at 1009.

AFFIRMED.