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Joined 1 year ago
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Cake day: December 25th, 2023

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  • Actually casinos so tax you on the US!

    And it’s not tax on the owning part but tax on the regular payments you receive from your funds. Think of the thanks stock buybacks or more simple yearly profit shares (dividends).

    What you describe ironically is something France tried a but as and Germany is discussing every couple of years: a tax not on income but in wealth. It’s as you described really tough to do right though from what I understand, again because it’s so easy to evade.

    Overall an interesting but kind of depressing topic to be honest.


  • Oh I am with you regarin both the need for change as well as the potential - I only focus on the question of income vs sales tax structure and abolishing one of the two withouz deeper adjustments.

    The pensioner example in more detail, I’m using wrong numbers to make it easier for me :)

    I am a pensioner with 100k in my pension fund (which st least where I’m from is treated similar to any other stock fund). I get 1000 Euro out of that per month in capital gain. I would have a 300 Euro tax on that. which I use to pay off my student loan, a consumer loan from a past mistake and the rest of a loan for my flat. I live from my state pension which allows me to barely scrape by.

    If I can get tax exempt for paying of my (imo ridiculous) student loan and the rest im fine. How if I have to pay the tax on top of that I’m suddenly 300 Euro down. The social system says “that’s a bad thing, people should have something from their money so we allow them to get tax credits for past debts - after all they did consume for that money and this helps the economy overall”.

    Now rich asshole scipiti comes around and says: yo bank, I earn too much, give me 60mio credit, here’s the future capital gain and the stocks as security. Oh and tax man: I can’t pay any taxes because I have to serve this 60mio credit which I used for my second yacht.

    What most states do is now make rules which give more details on what can be exempt under which circumstances. But rich me does a quick calculation and it’s way better to pay very smart people to figure out how can I still abuse the system. that’s why we can’t simply close loopholes: a) there might be side effects and that’s a scary thought for law makers. b) we still want certain people to benefit and it’s still worth it for them to benefit even though there is abuse. And sadly c) the incentive to close them is really low as the benefit is low on average for all voters but the pushback I get from the abusers is really big (imagine Elon musks money gets distributed evenly among every citizen of a state where one of his businesses resides vs the damage he can cause to any political individual).

    I left the economic discussion btw completely as this is more speculation and political behavioral pattern observation in not exactly equal parts.


  • From a tax perspective:

    Stock earnings are not income.

    Neither is capital gain - and it would need to be tackled as you suggested with q capital gains tax. But that is quite easy to circumvent in basically all countries because it’s nearly impossible to check (as seen in the many scandals like cumex).

    And then there is the whole banking apparatus: I can use stocks as security against cheap loans, use the loaned money for consumption and then lower my capital gains tax by calculating those loans against my gains. Remove that loophole and suddenly a pensioner can’t pay for their running costs anymore

    All of that lead down a rabbit hole of “but can’t we just” for me. At least my conclusion: I didn’t come up with something that a) doesn’t break apart already on paper b) can be implemented without international collaboration and c) can’t be abused just as easy.

    Personal note and speculation: often I read people taking about a system that is designed against group X. I disagree: the financial systems were not designed with any goal in kind at all outside the specific needs and questions for the specific legislatures. Meaning that “we need to fund a social security system” and “why don’t billionaires pay more tax” have the same root: we humans are terrible at overseeing time horizons of more than a few years. But we’re absolutely genius in taking something apart and finding loop holes the size of a raisin.


  • That’s a great question in my opinion and the answer lies in the ways money moves around.

    There are a lot of ways to get money that are not limited by income tax, depending on your specific country and tax structure.

    Examples can be rent, inheritance, gifts and revenue/profits. I’m addition there is all the money that was earned elsewhere.

    I’m short the sales tax is aimed at all consuming entities while the income tax is limited to, well, income. To give another example: Companies themselves consume but don’t give any income tax.

    Now the follow up question might be why it’s designed that way. And that is something for the historians to answer. Make the sales tax too high though and people will country hop to shop, make income tax higher instead and you increase wealth gap even further (non income earnings are rewarded more)









  • One thing that was only mentioned briefly by someone else is the physical button turning on the computer.

    Similar to the paperclip test figure out where the power button goes into the mainboardw and bridge that with a short cable. Is possible that by moving the case the old button lost a cable.

    This is just one more thing to test though, it’s really trial and error as you know :)