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Question/Criticism: Verse 9:29 in the Qur'an teaches Muslims to make war against Christians and others and have them paying a tax until they are subdued.
The verse in the Qur'an regarding paying the Jizyah (tax) is as follows:
9.29. Fight those who believe not in God nor the Last Day, nor hold that forbidden which hath been forbidden by God and His Messenger, nor acknowledge the religion of Truth, (even if they are) of the People of the Book, until they pay the Jizya (TAX) with willing submission, and feel themselves subdued.
This is where the Arabic and the historical context would help. But nevertheless let us examine this verse carefully just by using the English translation. The verse states directly to fight and it gives specific conditions on whom to fight. It tells Muslims that three conditions must be met in order to fight other people. It also states that these people we are to fight do not forbid certain things by using the words, “nor hold that forbidden”. By stating “nor hold that forbidden” the Qur'an is referring to people who have the power to forbid; therefore it is talking about people in leadership. Let's look at the conditions specified in the verse carefully about who Muslims are supposed to fight. They are: (1). People who believe not in God and the last day AND (2), don't forbid what God and his messenger has forbidden AND (3), don't acknowledge the religion of truth. This applies even if they are Christians or Jews. Most Christians believe in God and the last day so they don't meet criteria (1).
(2), don't forbid what God and his messenger has forbidden. The next question is to find out what is it that God forbids that these people who Muslims are to fight accept and find OK to do? You can check the Qur'an yourself but you would find that evil, wrong doing, murder, lies, rape, torture and all manner of wrongs against God and his creatures are forbidden. Changing the construct from a negative tense and viewing this from a positive tense, this is telling Muslims that they are to fight the leadership of people who are evil and who endorse evils. People who kill, steal, torture, conduct ethnic cleansing and perform all the evils that the Qur'an forbids and even if those people are among the Christians and the Jews. The Zionists are good examples.
(3), don't acknowledge the religion of truth. I think if you read the Qur'an you would find that it refers to the oneness of the revelations from all Prophets from Abraham to Muhammad (peace be upon them). According to Islam all those prophets are of one brotherhood and they all taught the truth. So the religion of truth is not referring to what God revealed to Muhammad (saw) exclusively. It also refers to the truth of what other Prophets and messengers before him brought. So the truth of Jesus and Moses (peace be upon them) are also considered by Muslims to be the religion of truth. By the way Islam mentions that only some of the Prophets are named in the Qur'an. There are more than 125,000 that Islam states are not so named. In fact the Qur'an goes so far as to say ANY who believe in God and work righteousness will receive rewards from God as in the following verse:
Those who believe (in the Qur’an) And those who follow the Jewish (Scriptures) And the Christians and the Sabians, - ANY who believe in G-d And the Last Day, And work righteousness, Shall have their reward With their Lord: on them Shall be no fear, nor shall they grieve. (2:62)
So even by reading the English alone and carefully following what it is saying this is NOT a blanket order to go and fight non-Muslims. Instead it is an order to fight evil doers. By specifying “nor holds that forbidden”, the verse is addressing the leaders of evil doing. Simply put, it is telling Muslims to fight the leadership of people who are evil, commit murder, endorse ethnic cleansing, steal, torture, and all manner of sick and despicable acts condemned in the Qur’an that they refuse to forbid. These people could even be amongst the Christians and the Jews. We have a lot of good examples of people like that in history. On the Christian side we have Hitler, the Crusaders, the corrupt Popes and Christian leadership who instituted the Inquisition, KKK, the evil European conquerors and enslavers of Africans, Indians, Chinese, etc and I could go on and on. On the Jewish side we have the Zionists murderers, thieves and occupiers of Palestine, their leaders from Theodore Herzl to Benjamin Netanyahu, the ones who called for the murder of the noble Christ and every Prophet that God sent to them, Rabbi Kahane, Baruch Goldstein, the Jewish leaders of corruption in society including pornography, immoral influences spread through TV, movies, etc, Jewish Internationalist bankers putting a stranglehold on the economy of nations, Neocons responsible for pushing America into war to cause havoc, misery and death in the thousands for innocent Muslims around the world and I could go on and on.
This is not addressing good Christians and other human beings that are not committing evil acts. It becomes even clearer when you take into consideration other verses of the Qur'an that refers to Christian and Jews and also to who Muslims should befriend and not befriend. Here are a few:
God does not enjoin you from befriending those who do not fight you because of religion, and do not evict you from your homes. You may befriend them and be equitable towards them. God loves the equitable. (60:8)
God enjoins you only from befriending those who fight you because of religion, evict you from your homes, and band together with others to banish you. You shall not befriend them. Those who befriend them are the transgressors. (60:9)
"And there are, certainly, among the People of the Book, those who believe in God, in the revelation to you, and in the revelation to them, bowing in humility to God. They will not sell the Signs of God for a miserable gain! For them is a reward with their Lord, and God is swift in account." (3:199)
"To those against whom war is made, permission is given (to fight), because they are wronged;--and verily God is Most Powerful For their aid;--
"And fight them on until there is no more Tumult or oppression, and there prevail justice and faith in God. But if they cease, Let there be no hostility except to those who practice oppression." (2:93)
85. Strongest among men in enmity to the Believers wilt thou find the Jews and Pagans; And nearest among them in love to the Believers wilt thou find those who say, "We are Christians": Because amongst these are men devoted to learning and men who have renounced the world, and they are not arrogant."
Regarding the Jizya or tax that non-Muslims had to pay living under Muslim rule to enjoy the protections of a Muslim state, the enemies of Islam makes it sound like the jizya was some crippling tax that kept the dhimmis in the gutter. It was one dinar and one measure of wheat, taxed yearly. And it was not collected upon women, children, invalids, or the elderly. Even the most destitute could have afforded it. It was a tax collected because non-Muslim young men were not conscripted into the military like Muslim men were. But if non-Muslim young men volunteered to be conscripted, then they did not have to pay the jizya tax. Rather than give you my words I want to quote the great Mathematician and Philosopher Bertrand Russell on this.
"I have always been told throughout my youth of the fanaticism of the Mohammedans, and especially that story of the destruction of the library at Alexandria. Well, I believed all these stories, but when I came to look into the history of the times concerned, I had a great many shocks. In the first place, I discovered that the library of Alexandria was destroyed a great many times, and the first time was by Julius Caesar. But the last time was supposed to have been by the Mohammedans, and for this I found no justification whatsoever. Nor did I find that the Mohammedans were fanatical. The contests between Catholics, Nestorians, and Monophysites were bitter and persecuting to the last degree. But the Mohammedans, when they conquered Christian countries, allowed the Christians to be perfectly free, provided they pay a tribute. The only penalty for being a Christian was that you had to pay a tribute that Mohammedans did not have to pay. This proved completely successful, and the immense majority of the population became Mohammedans, but not through any fanaticism on the part of the Mohammedans. On the contrary they, in the earlier centuries of their power, represented free thought and tolerance to a degree that the Christians did not emulate until quite recent times."
Bertrand Russell (Eng. philosopher, mathematician, 1872-1970): "Reading History As It Is Never Written" 
So even according to Bertrand Russell this tax that non-Muslims had to pay was not an un-surmountable burden rather it served as an incitement for non-Muslims to become Muslims as a result of the fairness of Muslims in administering the tax.
The other component with reading the Qur'an is knowing something about the life of Prophet Muhammad (saaw) and how he handled situations. That is also a great guide to help Muslims to know how to behave. A good example dealing with this subject is how Muhammad (saaw) behaved and treated the pagans when the pagans were defeated in Makkah. He allowed the pagans to live freely and treated them with fairness and kindness. If indeed he was following the misunderstanding of verse 9:29, as pushed by haters of Islam, he would have fought and killed the pagans. Instead he allowed them to live freely and after a period of time the whole Arabian Peninsula was converted to Islam as a result of the tolerant nature of Muslims following the example of Muhammad (saaw).
Listen to http://www.poweroftruthradio.com/ an alternative radio station dedicated to exposing and broadcasting truths about Islam not heard on the mainstream media.