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Ask HN: If there's no corruption, why can't inflation tax replace all other?

5 points by pacavaca 8y ago

thorin 8y ago
The tax system has to be very complicated so: 1. Consultancies, accounting firms and senior government make huge amounts facilitating it 2. Enables evasion by the rich and punishment of the poor! 3. We don't realise how much tax we're paying on stuff
- pacavaca 8y ago
  Right. That's pretty much why I'm asking. From the engineering standpoint it just doesn't make sense to have all these organization, they're just adding a huge overhead to the system. However, I agree that it is how it is for a reason, just trying to understand the driving forces that form the current taxation system.
danieltillett 8y ago
Inflation creates short term thinking (spend don’t save). The other downside is inflation is quite regressive. Personally if we are going to dream about changing the tax system then Georgism is the way to go [0], but good luck getting political support. [0]. https://en.wikipedia.org/wiki/Georgism https://en.wikipedia.org/wiki/Georgism
- himlion 8y ago
  The r/georgism subreddit has some interesting articles on the topic.
itamarst 8y ago
Taxes are how the government makes a sovereign money worth something. You need dollars because you need to pay taxes in dollars. You might want to read some Modern Monetary Theory: http://neweconomicperspectives.org/modern-monetary-theory-primer.html http://neweconomicperspectives.org/modern-monetary-theory-pr...
- AnimalMuppet 8y ago
  Note that "modern monetary theory", despite the name, is not a mainstream economic perspective.
- danieltillett 8y ago
  No what makes sovereign money have value is the threat of violence. The government could force the population at the end of a gun to accept payment for the goods and services it wants with no taxation (i.e. give me X and take this paper token in exchange or you and your family will be shot). Taxation is just a more polite version of a shakedown. In practice since most taxation is just used to pay for goods and services the population wants there is popular support for taxes. In places where taxation is more outright theft, tax avoidance is rampant.
AnimalMuppet 8y ago
But there is corruption. Any plan that involves changing human nature probably isn't going to work.
tmaly 8y ago
the Fed's ZIRP is an inflation tax. The benefits are just distributed to those with access to the borrowing window

5 points by pacavaca 8y ago

The tax system has to be very complicated so: 1. Consultancies, accounting firms and senior government make huge amounts facilitating it 2. Enables evasion by the rich and punishment of the poor! 3. We don't realise how much tax we're paying on stuff

pacavaca 8y ago
Right. That's pretty much why I'm asking. From the engineering standpoint it just doesn't make sense to have all these organization, they're just adding a huge overhead to the system. However, I agree that it is how it is for a reason, just trying to understand the driving forces that form the current taxation system.

danieltillett 8y ago

Inflation creates short term thinking (spend don’t save). The other downside is inflation is quite regressive. Personally if we are going to dream about changing the tax system then Georgism is the way to go [0], but good luck getting political support. [0]. https://en.wikipedia.org/wiki/Georgism https://en.wikipedia.org/wiki/Georgism

himlion 8y ago
The r/georgism subreddit has some interesting articles on the topic.

itamarst 8y ago

Taxes are how the government makes a sovereign money worth something. You need dollars because you need to pay taxes in dollars. You might want to read some Modern Monetary Theory: http://neweconomicperspectives.org/modern-monetary-theory-primer.html http://neweconomicperspectives.org/modern-monetary-theory-pr...

AnimalMuppet 8y ago
Note that "modern monetary theory", despite the name, is not a mainstream economic perspective.
danieltillett 8y ago
No what makes sovereign money have value is the threat of violence. The government could force the population at the end of a gun to accept payment for the goods and services it wants with no taxation (i.e. give me X and take this paper token in exchange or you and your family will be shot). Taxation is just a more polite version of a shakedown. In practice since most taxation is just used to pay for goods and services the population wants there is popular support for taxes. In places where taxation is more outright theft, tax avoidance is rampant.

AnimalMuppet 8y ago

But there is corruption. Any plan that involves changing human nature probably isn't going to work.

tmaly 8y ago

the Fed's ZIRP is an inflation tax. The benefits are just distributed to those with access to the borrowing window