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Which raises the obvious point that a specifically carved out exception for a good on the basis of its assumed positive externalities is not a ‘loophole’. It is

Which raises the obvious point that a specifically carved out exception for a good on the basis of its assumed positive externalities is not a ‘loophole’. It is at most a subsidy. (Though, obviously, not enough of one. Land ownership should be taxed but land rental should be untaxed, as a quick glimpse at the market incentive structures will inform. Taxing revenue is insane.)

maeln 3y ago
I think it is a usual case of "This is why we can't have nice things". The "loophole" was created for a reason and then it got abused to a point of becoming its own issue.
robertlagrant 3y ago
When you write down rules by which you can take money for free from other people, any rule that means they don't have to give you money is, whether you call it a loophole or not, not a problem. Write your free money rules better.
- Retric 3y ago
  That would apply if governments were simply bandits providing nothing of value. Instead, governments provide many extremely valuable services. So, people rightly complain about free riders benefiting from the services which other taxpayers need to pay for without chipping in.
  - phpisthebest 3y ago
    The fact is that the government, like a bandit, says to a person: Your money, or your life. And many, if not most, taxes are paid under the compulsion of that threat. The government does not, indeed, waylay a person in a lonely place, spring upon them from the road side, and, holding a pistol to their head, proceed to rifle their pockets. But the robbery is none the less a robbery on that account; and it is far more dastardly and shameful. The bandit takes solely upon himself the responsibility, danger, and crime of his own act. He does not pretend that he has any rightful claim to your money, or that he intends to use it for your own benefit. He does not pretend to be anything but a robber. He has not acquired impudence enough to profess to be merely a “protector,” and that he takes people’s money against their will, merely to enable him to “protect” those infatuated travelers, who feel perfectly able to protect themselves, or do not appreciate his peculiar system of protection. He is too sensible a man to make such professions as these. Furthermore, having taken your money, he leaves you, as you wish him to do. He does not persist in following you on the road, against your will; assuming to be your rightful “sovereign,” on account of the “protection” he affords you. He does not keep “protecting” you, by commanding you to bow down and serve him; by requiring you to do this, and forbidding you to do that; by robbing you of more money as often as he finds it for his interest or pleasure to do so; and by branding you as a rebel, a traitor, and an enemy to your country, and shooting you down without mercy, if you dispute his authority, or resist his demands. He is too much of a gentleman to be guilty of such impostures, and insults, and villanies as these. In short, he does not, in addition to robbing you, attempt to make you either his dupe or his slave. --Lysander Spooner
    - sofixa 3y ago
      (on libertrarians) House cats. They are convinced of their fierce independence while utterly dependent on a system they don't appeciate or understand. -- John Spaulding
      - AnthonyMouse 3y ago
        Cats are quite capable of subsisting on squirrels and birds. But if you put cat food on a plate, they do what's easier. The question is, does "free" stuff justify its true cost? How many people would willingly pay the amount they currently pay to Raytheon or upper middle class retirees with plenty of savings, if they actually had a choice?
        Retric 3y ago
        Spending isn’t just individual choices it’s a tradeoff. I can guarantee you want a lot of government spending that I would be happy to cut. If I argue for canceling all weather satellite funding you can bet many would object and so it goes. I personally think the CIA, NSA etc are a waste of funds let’s slash funding by 90% and see what happens. But that doesn’t mean everyone else agrees with what I think is worth funding.
        AnthonyMouse 3y ago
        But that's kind of the point, isn't it? If all the people who want GPS didn't have to pay for bridges they don't want (and war machines and corporate welfare) then they'd have enough money to pay for GPS even if they were the only ones paying, and vice versa. You can still have GPS and bridges because they each have a set of people who value them at more than their cost. Whereas if the only people who want corn subsidies are the people receiving them and not the people paying for them, you wouldn't have them anymore.
        Retric 3y ago
        It’s a more complicated problem because if you get rid of say prisons and the police you don’t get groups of individuals privately funding such things. It’s a free rider problem where as can be demonstrated around the world the only known solution is collective taxation. If you want GPS and are happy to pay for it then why should I pay if I can get it for free without paying? With GPS the idea of encrypting the data might work, but that doesn’t work for say vaccination were public safety results from individual choices.
  - robertlagrant 3y ago
    No, it applies whether governments provide perfect value for money, zero value for money, or something in between. The question isn't how it's spent. The question is: should we be of the mindset that companies that obey the rules as written are somehow not obeying the "real" rules, rather than putting the fault on the rule writers, whose only purpose is to write good rules, and who are part of the "extremely valuable services" we all pay for?
    - Retric 3y ago
      How much money is spent is ultimately how much money needs to be collected in taxes in one form or another. There is no way to reduce taxes on X without eliminating some spending or increasing taxes elsewhere. Perhaps you’re fine eliminating GPS to reduce your taxes, but in general people don’t want to shut that down etc. In the end it’s not a question of obeying the rules it’s a question of individuals or companies writing those rules to favor themselves and others objecting to those rules.
      - robertlagrant 3y ago
        Well, no, unless you think money is spent efficiently. And also no, in that money is also borrowed, and the currency is also inflated, so the government has more unit currency to spend. If taxes balanced spending, without taxes just being exorbitant personal effort-destroying monsters, then there'd be no debate. But anyway. That still is irrelevant to this point, which is that writing down rules is the easy bit, and creating value year on year is the hard bit. Blame the people who get free money to write rules that get them money if there are loopholes. Don't blame the people actually working to make them that free money.
        Retric 3y ago
        Inflation is a form of taxation, everyone with that currency loses value. Thus when you borrow below the inflation rate the difference is “paid off” by taxing people. Borrowing isn’t free money, it’s in fact more expensive than taxing people directly. > That still is irrelevant to this point, which is that writing down rules is the easy bit, and creating value year on year is the hard bit. Hardly, making money from investments isn’t difficult and has some of the largest tax breaks built in. As someone that’s inherited money I can say theirs nothing inherently virtuous or difficult about it and wow it’s tax free! But hey I am glad you’re working extra hard so I can lazy around as much as I feel like it.
simiones 3y ago
I think the loophole is that Airbnb is profiting massively by renting all of these properties, but each property owner individually is not making significant profits. I would guess the intention is to tax Airbnb appropriately as one of the biggest hotel services out there, without affecting actual independent BnBs.
- vladvasiliu 3y ago
  > I think the loophole is that Airbnb is profiting massively by renting all of these properties, but each property owner individually is not making significant profits. While I do think that the government would like more tax revenue from AirBnB and other "foreign tech", I think that in touristy areas property owners are making a killing. Aside from the "loophole" discussed here, another one is that, for example in Paris, these rentals aren't covered by the rent control laws. So even though you need to put in a bit more work for short stays compared to long ones, you're practically guaranteed a good occupation rate for your apartment and can cash in on the much higher rate you can charge. I don't know how true this is, as opposed to a knee-jerk reaction by locals, but it would seem that in other touristy places there's been an influx in "holiday-rentals" pushing locals who can't afford the rising prices out of the market. These areas have more of a season effect (think seaside resorts, only popular in the summer). So, the way they "measured" it was that during the low season people would find rentals, but no-one would want a long-term contract covering the high-season, when all the properties would be put on the short-term market. Another regulation which these rentals can side-step is having to provide an apartment with a certain minimum "energy grade". The goal of the scheme was to push landlords to improve the insulation of their properties to lower heating costs (broadly speaking). The issue is that rents being fixed, this had to come fully out of the landlord's pocket. Which, of course, they'd rather avoid. Bonus points for having to add this insulation on the inside, which reduces the area of the property, so the rent they can ask. This is compounded in "tense" markets, such as Paris, by the fact that many of the flats are concerned by this, or will soon be.
comte7092 3y ago
A loophole is when something is used for something other than its intended purpose. France wanted to subsidize b&bs, Airbnb, despite its name, doesn’t actually provide b&bs as a significant part of its business.
- mytailorisrich 3y ago
  In this case it is used exactly for its intended purpose, which is to encourage furnished holiday lets. AirBnb does not directly benefit from this. The property owners do. The issue is that the number of holiday lets has exploded thanks to AirBnb so now they no longer want to encourage them, or at least not the purely AirBnb type.
  - csomar 3y ago
    It is another tax but without the tax label. Now we call it "Closing a loophole for the greedy Tech companies".
- Veedrac 3y ago
  If true that's even more convoluted than I would have guessed. And I agree with the other comment; if you want to subsidize b&bs but you instead subsidize furnished rentals, it's on you when it's treated as a furnished rentals subsidy.
- yieldcrv 3y ago
  I used to think that But I’ve seen single words changed in budget appropriation bills that completely altered a tax reality in any observer’s favor, that no politician read Fun game, hard for me to draw a clear distinction on what’s a loophole or not. If the government says my “fair share” is 0% fine by me.

maeln 3y ago

I think it is a usual case of "This is why we can't have nice things". The "loophole" was created for a reason and then it got abused to a point of becoming its own issue.

robertlagrant 3y ago

When you write down rules by which you can take money for free from other people, any rule that means they don't have to give you money is, whether you call it a loophole or not, not a problem. Write your free money rules better.

Retric 3y ago
That would apply if governments were simply bandits providing nothing of value. Instead, governments provide many extremely valuable services. So, people rightly complain about free riders benefiting from the services which other taxpayers need to pay for without chipping in.
- phpisthebest 3y ago
  The fact is that the government, like a bandit, says to a person: Your money, or your life. And many, if not most, taxes are paid under the compulsion of that threat. The government does not, indeed, waylay a person in a lonely place, spring upon them from the road side, and, holding a pistol to their head, proceed to rifle their pockets. But the robbery is none the less a robbery on that account; and it is far more dastardly and shameful. The bandit takes solely upon himself the responsibility, danger, and crime of his own act. He does not pretend that he has any rightful claim to your money, or that he intends to use it for your own benefit. He does not pretend to be anything but a robber. He has not acquired impudence enough to profess to be merely a “protector,” and that he takes people’s money against their will, merely to enable him to “protect” those infatuated travelers, who feel perfectly able to protect themselves, or do not appreciate his peculiar system of protection. He is too sensible a man to make such professions as these. Furthermore, having taken your money, he leaves you, as you wish him to do. He does not persist in following you on the road, against your will; assuming to be your rightful “sovereign,” on account of the “protection” he affords you. He does not keep “protecting” you, by commanding you to bow down and serve him; by requiring you to do this, and forbidding you to do that; by robbing you of more money as often as he finds it for his interest or pleasure to do so; and by branding you as a rebel, a traitor, and an enemy to your country, and shooting you down without mercy, if you dispute his authority, or resist his demands. He is too much of a gentleman to be guilty of such impostures, and insults, and villanies as these. In short, he does not, in addition to robbing you, attempt to make you either his dupe or his slave. --Lysander Spooner
  - sofixa 3y ago
    (on libertrarians) House cats. They are convinced of their fierce independence while utterly dependent on a system they don't appeciate or understand. -- John Spaulding
    - AnthonyMouse 3y ago
      Cats are quite capable of subsisting on squirrels and birds. But if you put cat food on a plate, they do what's easier. The question is, does "free" stuff justify its true cost? How many people would willingly pay the amount they currently pay to Raytheon or upper middle class retirees with plenty of savings, if they actually had a choice?
      - Retric 3y ago
        Spending isn’t just individual choices it’s a tradeoff. I can guarantee you want a lot of government spending that I would be happy to cut. If I argue for canceling all weather satellite funding you can bet many would object and so it goes. I personally think the CIA, NSA etc are a waste of funds let’s slash funding by 90% and see what happens. But that doesn’t mean everyone else agrees with what I think is worth funding.
        AnthonyMouse 3y ago
        But that's kind of the point, isn't it? If all the people who want GPS didn't have to pay for bridges they don't want (and war machines and corporate welfare) then they'd have enough money to pay for GPS even if they were the only ones paying, and vice versa. You can still have GPS and bridges because they each have a set of people who value them at more than their cost. Whereas if the only people who want corn subsidies are the people receiving them and not the people paying for them, you wouldn't have them anymore.
        Retric 3y ago
        It’s a more complicated problem because if you get rid of say prisons and the police you don’t get groups of individuals privately funding such things. It’s a free rider problem where as can be demonstrated around the world the only known solution is collective taxation. If you want GPS and are happy to pay for it then why should I pay if I can get it for free without paying? With GPS the idea of encrypting the data might work, but that doesn’t work for say vaccination were public safety results from individual choices.
- robertlagrant 3y ago
  No, it applies whether governments provide perfect value for money, zero value for money, or something in between. The question isn't how it's spent. The question is: should we be of the mindset that companies that obey the rules as written are somehow not obeying the "real" rules, rather than putting the fault on the rule writers, whose only purpose is to write good rules, and who are part of the "extremely valuable services" we all pay for?
  - Retric 3y ago
    How much money is spent is ultimately how much money needs to be collected in taxes in one form or another. There is no way to reduce taxes on X without eliminating some spending or increasing taxes elsewhere. Perhaps you’re fine eliminating GPS to reduce your taxes, but in general people don’t want to shut that down etc. In the end it’s not a question of obeying the rules it’s a question of individuals or companies writing those rules to favor themselves and others objecting to those rules.
    - robertlagrant 3y ago
      Well, no, unless you think money is spent efficiently. And also no, in that money is also borrowed, and the currency is also inflated, so the government has more unit currency to spend. If taxes balanced spending, without taxes just being exorbitant personal effort-destroying monsters, then there'd be no debate. But anyway. That still is irrelevant to this point, which is that writing down rules is the easy bit, and creating value year on year is the hard bit. Blame the people who get free money to write rules that get them money if there are loopholes. Don't blame the people actually working to make them that free money.
      - Retric 3y ago
        Inflation is a form of taxation, everyone with that currency loses value. Thus when you borrow below the inflation rate the difference is “paid off” by taxing people. Borrowing isn’t free money, it’s in fact more expensive than taxing people directly. > That still is irrelevant to this point, which is that writing down rules is the easy bit, and creating value year on year is the hard bit. Hardly, making money from investments isn’t difficult and has some of the largest tax breaks built in. As someone that’s inherited money I can say theirs nothing inherently virtuous or difficult about it and wow it’s tax free! But hey I am glad you’re working extra hard so I can lazy around as much as I feel like it.

simiones 3y ago

I think the loophole is that Airbnb is profiting massively by renting all of these properties, but each property owner individually is not making significant profits. I would guess the intention is to tax Airbnb appropriately as one of the biggest hotel services out there, without affecting actual independent BnBs.

vladvasiliu 3y ago
> I think the loophole is that Airbnb is profiting massively by renting all of these properties, but each property owner individually is not making significant profits. While I do think that the government would like more tax revenue from AirBnB and other "foreign tech", I think that in touristy areas property owners are making a killing. Aside from the "loophole" discussed here, another one is that, for example in Paris, these rentals aren't covered by the rent control laws. So even though you need to put in a bit more work for short stays compared to long ones, you're practically guaranteed a good occupation rate for your apartment and can cash in on the much higher rate you can charge. I don't know how true this is, as opposed to a knee-jerk reaction by locals, but it would seem that in other touristy places there's been an influx in "holiday-rentals" pushing locals who can't afford the rising prices out of the market. These areas have more of a season effect (think seaside resorts, only popular in the summer). So, the way they "measured" it was that during the low season people would find rentals, but no-one would want a long-term contract covering the high-season, when all the properties would be put on the short-term market. Another regulation which these rentals can side-step is having to provide an apartment with a certain minimum "energy grade". The goal of the scheme was to push landlords to improve the insulation of their properties to lower heating costs (broadly speaking). The issue is that rents being fixed, this had to come fully out of the landlord's pocket. Which, of course, they'd rather avoid. Bonus points for having to add this insulation on the inside, which reduces the area of the property, so the rent they can ask. This is compounded in "tense" markets, such as Paris, by the fact that many of the flats are concerned by this, or will soon be.

comte7092 3y ago

A loophole is when something is used for something other than its intended purpose. France wanted to subsidize b&bs, Airbnb, despite its name, doesn’t actually provide b&bs as a significant part of its business.

mytailorisrich 3y ago
In this case it is used exactly for its intended purpose, which is to encourage furnished holiday lets. AirBnb does not directly benefit from this. The property owners do. The issue is that the number of holiday lets has exploded thanks to AirBnb so now they no longer want to encourage them, or at least not the purely AirBnb type.
- csomar 3y ago
  It is another tax but without the tax label. Now we call it "Closing a loophole for the greedy Tech companies".
Veedrac 3y ago
If true that's even more convoluted than I would have guessed. And I agree with the other comment; if you want to subsidize b&bs but you instead subsidize furnished rentals, it's on you when it's treated as a furnished rentals subsidy.
yieldcrv 3y ago
I used to think that But I’ve seen single words changed in budget appropriation bills that completely altered a tax reality in any observer’s favor, that no politician read Fun game, hard for me to draw a clear distinction on what’s a loophole or not. If the government says my “fair share” is 0% fine by me.