What does Matthew 22:17 mean?

Some Pharisees who want to get rid of Jesus have sent their disciples to spring a trap. They plan to soften Jesus up with flattery (Matthew 22:16), then pose a hard question. They hope His answer will offend His Jewish followers or get Him in trouble with the Romans. To further disguise their intent, they have recruited people from a group known as the Herodians to approach Jesus along with their own students. This setup attempts to give the illusion that a young group is asking Jesus to arbitrate a dispute. Jesus, however, is not fooled at all (Matthew 22:18).

Now they pop this dangerous question: Is it lawful to pay taxes to Caesar or not?

The tax in question is apparently the Roman "head tax," demanded from every Jewish citizen. The Pharisees, as cultural and religious purists, despised even the idea of paying taxes to a foreign, godless government. Those loyal to Jesus who hoped He was the Messiah may have wanted Him to signal the time for revolt by announcing that they should not pay the tax any longer. The Pharisees hope if Jesus says it is lawful to pay this tax, He will lose a sizeable number of followers. That will create an opening for them to have Jesus killed.

On the other hand, the Herodians wanted the Romans to trust them enough to make a Herod king over all of Israel once more. Because of that, they would not want to cause any unrest in Israel. If Jesus said not to pay the tax, the Herodians might be able to have Jesus arrested as a rebel and executed by the Romans.

The trap was set. Would Jesus risk offending His followers, suffering under a huge tax burden, by saying the law demanded they pay the tax? Or would He risk losing His freedom and life by saying they should defy Roman control and stop paying the tax? His answer, as usual, is brilliant and completely diffuses their attack.