10 ms·

Avoidance, not evasion. If you're a very frugal person, it seems pretty normal to hate taxes. No point in saving on everything, yet then throwing x% away in tax

Avoidance, not evasion. If you're a very frugal person, it seems pretty normal to hate taxes. No point in saving on everything, yet then throwing x% away in taxes (yes, I am aware taxes fund a lot of good things, but at the same time a lot of money is wasted -- I'm sure Kamprad thought he could better manage and deploy that money)

andrepd 9y ago
Oh nice, if he thought he could use the money better, then sure, please carry on not paying taxes. Can I do the same? Or is that a privilege reserved for the mega-rich? Or let's call a spade a spade, and let's call tax evasion tax evasion.
- ptaipale 9y ago
  Sure, call tax evasion tax evasion, but AFAIK Kamprad wasn't doing it. Authorities go very hard against tax evasion, the illegal thing. Tax avoidance is by definition things that are legal, not tax evasion.
  - TheOtherHobbes 9y ago
    In fact authorities are pretty lenient on tax evasion by the hyper-rich. The number of convictions and jail sentences isn't zero, but given the sums involved it's pitifully low. This is partly a resource problem. If you can pay advisors to create an impenetrable network of shell companies through which money disappears five levels down, you can pay lawyers to defend you if something goes wrong. The authorities are far more likely to go after - and jail - sole traders, smaller SMEs and consultants for five or six figure transgressions than near-billionaires with six, seven, or eight figure creative accounting.
    - ptaipale 9y ago
      It's not only relevant what the sums involved are. It is very relevant whether laws are broken, and how clear the lawbreaking is. Thus you can have large sums involved, but may find out that law wasn't broken, so there is no conviction. This is as it should be.
    - TeMPOraL 9y ago
      I think there are also significant risks involved when facing the hyper-rich. SMEs are a dime a dozen. If some get sacked for skirting or breaking the rules, nobody cares. But if you piss off a large megacorp enough to make it e.g. build its new factory elsewhere, or move its business away entirely, then suddenly your political career is on the line.
- Hello71 9y ago
  You're not calling a spade a spade, you're calling a trowel a spade. While they have similar means of operation and mostly similar results, their definitions are commonly understood to be different. Trowels are single handed tools, spades are double handed. Tax avoidance is carried out publicly and legal, if possibly unethical, whereas tax evasion is carried out in secret and is illegal.
- charlesdm 9y ago
  Want to stop avoidance? Make proper laws. If it's legal (even through lobbying), then it is legal. And frankly I don't see why you shouldn't if you legally can. But to each their own views on this. You know who can stop avoidance? Politicians. They need to take responsibility. Feel free to shame multinationals or HNWIs for not paying taxes, but at the end of the day avoidance is only possible because politicians (or their advisors) make shoddy laws that aren't well thought out. Tax avoidance is essentially nothing more than understanding the law and framework you are operating in well, and finding a way to place income outside of the application of the law. So make better laws -- that's the only thing that can stop (excessive) tax avoidance. As long as politicians and don't put in a significant effort to close loopholes, I don't have any issue with tax avoidance.
  - matthewmacleod 9y ago
    I can't agree with this enough. Expecting profit-motivated companies to voluntarily choose to pay more tax than they have to is fundamentally doomed to failure. One of the powers of the free market is to encourage the elimination of inefficiency and waste—not that it's perfect at that—and we can't expect to both have our cake and eat it, in that sense. I strongly agree that many companies should be contributing more to the state for the services that they use. But the way to do that is though robust and clear taxation frameworks, not some kind of general social pressure to pay an arbitrary, 'acceptable' amount of tax.
    - charlesdm 9y ago
      Yes, I agree they're not paying enough, and should be paying more. But that will only happen when laws are changed.
    - TheOtherHobbes 9y ago
      You can't have a robust and clear taxation framework in a plutocracy, because government is owned by the rich and run for the benefit of the rich. And they're hardly likely to support legislation that forces them to pay more tax. (Even if some are, there will always be a powerful lobbying effort agains any such move.) The economic and political rhetoric around "freedom", "taxation is bad because government is bad", and so on is a propaganda exercise. It isn't something that appeared spontaneously as a self-evident social truth. The more time I spend finding out about the history of political though in the US, the more I realise that the dominant narrative is the language and thinking of the hyper-rich, generated and maintained entirely for their benefit.
- dx034 9y ago
  Yes you can. Move to a country with low/no income taxes.
  - ptaipale 9y ago
    Kamprad didn't really move to avoid income taxes; Sweden has all these decades had a relatively high income taxation, even when Kamprad moved back to Sweden from Switzerland. What he ran away from was wealth taxation that showed intention of becoming confiscatory, meaning his company would be taken from his control by the government.
dna_polymerase 9y ago
Please cut the ’avoidance, not evasion’ bullshit. This scheme is outright evasion, legalized by lobbying in Brussels against national law. You know that otherwise you wouldn’t care to point out this nuisance.
- Hello71 9y ago
  The commonly understood definition of tax evasion includes that it must be illegal. You are simply appropriating more severe terminology in an attempt to inflate the strawman.
  - zimpenfish 9y ago
    I can't speak for the majority of people but I'd venture that more people would put "morally sketchy and ethically bankrupt tax avoidance" into the "tax evasion" bucket than not.
- matthewmacleod 9y ago
  I understand the frustration, but I really think this is an important distinction to make. Evasion is solved by rigorously enforcing existing tax frameworks. Avoidance is solved by closing loopholes. They're two different problems—although they share some things in common—and they require two different solutions.
  - rectang 9y ago
    The reason these particular laws inspire such revulsion is that they are bought and paid for by the fabulously wealthy. The law itself is immoral and illegitimate. Even those of us who are sure that after cutting down all the laws, we could not stand in the winds that would blow then (to paraphrase Bolt)... can feel appalled at such laws, their originators, facilitators, and apologists.
  - sooheon 9y ago
    > I really think this is an important distinction to make [...] they require two different solutions. Agreed. The problem, and the source of the frustration, is that your average poster on hacker news (or average human being on earth) has 0% influence on either of the solutions. It is the mega rich who hold all the power, who have the resources, energy, and clout to play these games. It doesn't really matter how you distinguish evasion and avoidance, both are driven by the same motivations, and where the line separating the two stands in any given jurisdiction is defined less by the qualities of the actual actions, and more by how much the rich have managed to encode into law vs. how safe they feel openly breaking it.
_jal 9y ago
Injecting legal definitions into an informal conversation is a cheap debater's trick, annoying, and and hijacks the conversation.
- matthewmacleod 9y ago
  It's not semantic, or a legal definition. It's a very explicit and important difference – 'evasion' is illegally avoiding taxation, and 'avoidance' is legally avoiding taxation. Messing these two different concepts up helps nobody and just muddles the two issues further. Avoidance is a problem that must be tackled on a global scale; but first, we have to be honest about what it is.
  - eeZah7Ux 9y ago
    > It's a very explicit and important difference It's a mere technicality. Important in a court of law - sure. Not important when discussing ethical implication of not paying taxes in the context of HN.
    - dsacco 9y ago
      > Not important when discussing ethical implication of not paying taxes in the context of HN. Legal definitions are not important for discussing ethical implications? This is a wildly unsubstantiated claim that you’re positing without any compelling argument behind it. What you’re saying is implicitly tantamount to saying a discussion of legislation is irrelevant in a discussion of ethics. Doing that literally dismisses entire schools of ethical philosophy. You don’t have to agree with legal definitions a priori, just like you don’t need to agree with particular ethical arguments. But you absolutely need to consider them for a well reasoned discussion about ethics. The legal definitions are there precisely because of past ethical discussions - legislative arguments are, categorically, ethical arguments. In fact, you could define legislation as the implementation of an ethical specification.
      - JoeAltmaier 9y ago
        Have to disagree. Laws may have something like an ethical base, but only as a nod to practicality - people have to believe in them. They are pragmatic to the core. Sure, there are ethical schools of pragmatism, and we surely include them in our ethical discussions (trolley car problems etc) but how the law lands on the trolley car is NOT any sort of arbiter of ethics?

andrepd 9y ago

Oh nice, if he thought he could use the money better, then sure, please carry on not paying taxes. Can I do the same? Or is that a privilege reserved for the mega-rich? Or let's call a spade a spade, and let's call tax evasion tax evasion.

ptaipale 9y ago
Sure, call tax evasion tax evasion, but AFAIK Kamprad wasn't doing it. Authorities go very hard against tax evasion, the illegal thing. Tax avoidance is by definition things that are legal, not tax evasion.
- TheOtherHobbes 9y ago
  In fact authorities are pretty lenient on tax evasion by the hyper-rich. The number of convictions and jail sentences isn't zero, but given the sums involved it's pitifully low. This is partly a resource problem. If you can pay advisors to create an impenetrable network of shell companies through which money disappears five levels down, you can pay lawyers to defend you if something goes wrong. The authorities are far more likely to go after - and jail - sole traders, smaller SMEs and consultants for five or six figure transgressions than near-billionaires with six, seven, or eight figure creative accounting.
  - ptaipale 9y ago
    It's not only relevant what the sums involved are. It is very relevant whether laws are broken, and how clear the lawbreaking is. Thus you can have large sums involved, but may find out that law wasn't broken, so there is no conviction. This is as it should be.
  - TeMPOraL 9y ago
    I think there are also significant risks involved when facing the hyper-rich. SMEs are a dime a dozen. If some get sacked for skirting or breaking the rules, nobody cares. But if you piss off a large megacorp enough to make it e.g. build its new factory elsewhere, or move its business away entirely, then suddenly your political career is on the line.
Hello71 9y ago
You're not calling a spade a spade, you're calling a trowel a spade. While they have similar means of operation and mostly similar results, their definitions are commonly understood to be different. Trowels are single handed tools, spades are double handed. Tax avoidance is carried out publicly and legal, if possibly unethical, whereas tax evasion is carried out in secret and is illegal.
charlesdm 9y ago
Want to stop avoidance? Make proper laws. If it's legal (even through lobbying), then it is legal. And frankly I don't see why you shouldn't if you legally can. But to each their own views on this. You know who can stop avoidance? Politicians. They need to take responsibility. Feel free to shame multinationals or HNWIs for not paying taxes, but at the end of the day avoidance is only possible because politicians (or their advisors) make shoddy laws that aren't well thought out. Tax avoidance is essentially nothing more than understanding the law and framework you are operating in well, and finding a way to place income outside of the application of the law. So make better laws -- that's the only thing that can stop (excessive) tax avoidance. As long as politicians and don't put in a significant effort to close loopholes, I don't have any issue with tax avoidance.
- matthewmacleod 9y ago
  I can't agree with this enough. Expecting profit-motivated companies to voluntarily choose to pay more tax than they have to is fundamentally doomed to failure. One of the powers of the free market is to encourage the elimination of inefficiency and waste—not that it's perfect at that—and we can't expect to both have our cake and eat it, in that sense. I strongly agree that many companies should be contributing more to the state for the services that they use. But the way to do that is though robust and clear taxation frameworks, not some kind of general social pressure to pay an arbitrary, 'acceptable' amount of tax.
  - charlesdm 9y ago
    Yes, I agree they're not paying enough, and should be paying more. But that will only happen when laws are changed.
  - TheOtherHobbes 9y ago
    You can't have a robust and clear taxation framework in a plutocracy, because government is owned by the rich and run for the benefit of the rich. And they're hardly likely to support legislation that forces them to pay more tax. (Even if some are, there will always be a powerful lobbying effort agains any such move.) The economic and political rhetoric around "freedom", "taxation is bad because government is bad", and so on is a propaganda exercise. It isn't something that appeared spontaneously as a self-evident social truth. The more time I spend finding out about the history of political though in the US, the more I realise that the dominant narrative is the language and thinking of the hyper-rich, generated and maintained entirely for their benefit.
dx034 9y ago
Yes you can. Move to a country with low/no income taxes.
- ptaipale 9y ago
  Kamprad didn't really move to avoid income taxes; Sweden has all these decades had a relatively high income taxation, even when Kamprad moved back to Sweden from Switzerland. What he ran away from was wealth taxation that showed intention of becoming confiscatory, meaning his company would be taken from his control by the government.

dna_polymerase 9y ago

Please cut the ’avoidance, not evasion’ bullshit. This scheme is outright evasion, legalized by lobbying in Brussels against national law. You know that otherwise you wouldn’t care to point out this nuisance.

Hello71 9y ago
The commonly understood definition of tax evasion includes that it must be illegal. You are simply appropriating more severe terminology in an attempt to inflate the strawman.
- zimpenfish 9y ago
  I can't speak for the majority of people but I'd venture that more people would put "morally sketchy and ethically bankrupt tax avoidance" into the "tax evasion" bucket than not.
matthewmacleod 9y ago
I understand the frustration, but I really think this is an important distinction to make. Evasion is solved by rigorously enforcing existing tax frameworks. Avoidance is solved by closing loopholes. They're two different problems—although they share some things in common—and they require two different solutions.
- rectang 9y ago
  The reason these particular laws inspire such revulsion is that they are bought and paid for by the fabulously wealthy. The law itself is immoral and illegitimate. Even those of us who are sure that after cutting down all the laws, we could not stand in the winds that would blow then (to paraphrase Bolt)... can feel appalled at such laws, their originators, facilitators, and apologists.
- sooheon 9y ago
  > I really think this is an important distinction to make [...] they require two different solutions. Agreed. The problem, and the source of the frustration, is that your average poster on hacker news (or average human being on earth) has 0% influence on either of the solutions. It is the mega rich who hold all the power, who have the resources, energy, and clout to play these games. It doesn't really matter how you distinguish evasion and avoidance, both are driven by the same motivations, and where the line separating the two stands in any given jurisdiction is defined less by the qualities of the actual actions, and more by how much the rich have managed to encode into law vs. how safe they feel openly breaking it.

_jal 9y ago

Injecting legal definitions into an informal conversation is a cheap debater's trick, annoying, and and hijacks the conversation.

matthewmacleod 9y ago
It's not semantic, or a legal definition. It's a very explicit and important difference – 'evasion' is illegally avoiding taxation, and 'avoidance' is legally avoiding taxation. Messing these two different concepts up helps nobody and just muddles the two issues further. Avoidance is a problem that must be tackled on a global scale; but first, we have to be honest about what it is.
- eeZah7Ux 9y ago
  > It's a very explicit and important difference It's a mere technicality. Important in a court of law - sure. Not important when discussing ethical implication of not paying taxes in the context of HN.
  - dsacco 9y ago
    > Not important when discussing ethical implication of not paying taxes in the context of HN. Legal definitions are not important for discussing ethical implications? This is a wildly unsubstantiated claim that you’re positing without any compelling argument behind it. What you’re saying is implicitly tantamount to saying a discussion of legislation is irrelevant in a discussion of ethics. Doing that literally dismisses entire schools of ethical philosophy. You don’t have to agree with legal definitions a priori, just like you don’t need to agree with particular ethical arguments. But you absolutely need to consider them for a well reasoned discussion about ethics. The legal definitions are there precisely because of past ethical discussions - legislative arguments are, categorically, ethical arguments. In fact, you could define legislation as the implementation of an ethical specification.
    - JoeAltmaier 9y ago
      Have to disagree. Laws may have something like an ethical base, but only as a nod to practicality - people have to believe in them. They are pragmatic to the core. Sure, there are ethical schools of pragmatism, and we surely include them in our ethical discussions (trolley car problems etc) but how the law lands on the trolley car is NOT any sort of arbiter of ethics?