4 ms·

This doesn't resolve the ongoing incentive to remove the LVT, creating immediate value for the current land-owners.

by chabons 2y ago

orangesite 2y ago
[flagged]
- andriesm 2y ago
  [flagged]
  - vincnetas 2y ago
    When you have nothing to eat, and the rules that are in play are so complicated that you need team of layers to understand them, "playing by the rules" does not sound really valid argument.
- vincnetas 2y ago
  In olden days when chopping of heads was more acceptable, smart people understood that "debt relief" was a way to somehow decrease a chance of loosing they'r heads :) Now, when technology (military) enables to control the masses more strictly this approach has fallen in popularity. https://en.wikipedia.org/wiki/History_of_debt_relief https://en.wikipedia.org/wiki/History_of_debt_relief
pydry 2y ago
What you describe applies to pretty much any tax on any asset. E.g. "if you tax bitcoin as capital gains that will only create an incentive to remove it because then the value of bitcoin will go up."
- quietbritishjim 2y ago
  A proper analogy would be a yearly tax on bitcoin sitting idly in your wallet, not a capital gains tax. Land is already subject to capital gains tax.
  - bboygravity 2y ago
    SIdenote: this is the case right now in Netherlands (and 2 or 3 other European countries) and has been for decades. They tax capital value instead of capital gains value.
    - Manuel_D 2y ago
      So, if you bought $100K of bitcoin, then 10 years later the value of bitcoin drops by 50% you not only lost $50K you also paid taxes just for possession of the bitcoin? That seems awful. It'd also incentivize a lot of people to get "hacked" and lose their bitcoin. This pattern has been observed in practice, such as in France: https://en.wikipedia.org/wiki/Wealth_tax#Capital_flight https://en.wikipedia.org/wiki/Wealth_tax#Capital_flight
      - bboygravity 2y ago
        Well what's fair depends on your situation. Let's say you invest 100k in Bitcoin and 10 years later it's 1M. In a capital gains system you would pay 252000 EUR in taxes on that (assuming 28% capital gains tax, which at least 1 country in Europe actually has). In the capital tax system you would have paid between 15.000 and 100.000 EUR of taxes on that over the same 10 years. Which is... much less. So you could argue that the tax on capital is much more "fair". It's definitely MUCH simpler in terms of administration, because you never ever have to prove the cost-basis of your investment. All you need to know is your current P&L. There are a lot of US brokers out there who deliberately "forget" to provide a cost basis when you buy shares (hello and fu DriveWealth).
        Manuel_D 2y ago
        > In the capital tax system you would have paid between 15.000 and 100.000 EUR of taxes on that over the same 10 years. Which is... much less. Unless bitcoin crashes to zero. Then you've not only lost the $100K you spent to buy the bitcoin. You've also paid these taxes just because you possessed this now-worthless asset. This is why capital taxes suck: you haven't actually made any money until you sell the asset. You can easily end up paying taxes on something that has zero value.
- rcpt 2y ago
  Sometimes there's only a single tax allowed. Like in the US the federal government can only tax income unless they change the constitution. LVT as the single tax would be much harder to repeal.
  - sokoloff 2y ago
    This is close to, but not entirely, true. The US federal government also has the power to levy direct capitation taxes (taxes that are effectively constant per-person without regard to any other factors). In practice, those taxes are impractically regressive, but the federal government does have that power under the Constitution.
scott_w 2y ago
This is a pretty weak argument, in my opinion: "we shouldn't do this because powerful people who don't benefit will try to undo it."
- at_compile_time 2y ago
  It's not an argument not to do it. I'm just pointing out that it isn't enough to make the world a better place, you need to have a plan ready for how to keep it that way or we just get captured again.
  - scott_w 2y ago
    No you don’t because no plan survives first contact with reality. You simply have to keep plugging the benefits and make it politically infeasible for MPs/Congress/Etc. to undo it.

This doesn't resolve the ongoing incentive to remove the LVT, creating immediate value for the current land-owners.

orangesite 2y ago

[flagged]

andriesm 2y ago
[flagged]
- vincnetas 2y ago
  When you have nothing to eat, and the rules that are in play are so complicated that you need team of layers to understand them, "playing by the rules" does not sound really valid argument.
vincnetas 2y ago
In olden days when chopping of heads was more acceptable, smart people understood that "debt relief" was a way to somehow decrease a chance of loosing they'r heads :) Now, when technology (military) enables to control the masses more strictly this approach has fallen in popularity. https://en.wikipedia.org/wiki/History_of_debt_relief https://en.wikipedia.org/wiki/History_of_debt_relief

pydry 2y ago

What you describe applies to pretty much any tax on any asset. E.g. "if you tax bitcoin as capital gains that will only create an incentive to remove it because then the value of bitcoin will go up."

quietbritishjim 2y ago
A proper analogy would be a yearly tax on bitcoin sitting idly in your wallet, not a capital gains tax. Land is already subject to capital gains tax.
- bboygravity 2y ago
  SIdenote: this is the case right now in Netherlands (and 2 or 3 other European countries) and has been for decades. They tax capital value instead of capital gains value.
  - Manuel_D 2y ago
    So, if you bought $100K of bitcoin, then 10 years later the value of bitcoin drops by 50% you not only lost $50K you also paid taxes just for possession of the bitcoin? That seems awful. It'd also incentivize a lot of people to get "hacked" and lose their bitcoin. This pattern has been observed in practice, such as in France: https://en.wikipedia.org/wiki/Wealth_tax#Capital_flight https://en.wikipedia.org/wiki/Wealth_tax#Capital_flight
    - bboygravity 2y ago
      Well what's fair depends on your situation. Let's say you invest 100k in Bitcoin and 10 years later it's 1M. In a capital gains system you would pay 252000 EUR in taxes on that (assuming 28% capital gains tax, which at least 1 country in Europe actually has). In the capital tax system you would have paid between 15.000 and 100.000 EUR of taxes on that over the same 10 years. Which is... much less. So you could argue that the tax on capital is much more "fair". It's definitely MUCH simpler in terms of administration, because you never ever have to prove the cost-basis of your investment. All you need to know is your current P&L. There are a lot of US brokers out there who deliberately "forget" to provide a cost basis when you buy shares (hello and fu DriveWealth).
      - Manuel_D 2y ago
        > In the capital tax system you would have paid between 15.000 and 100.000 EUR of taxes on that over the same 10 years. Which is... much less. Unless bitcoin crashes to zero. Then you've not only lost the $100K you spent to buy the bitcoin. You've also paid these taxes just because you possessed this now-worthless asset. This is why capital taxes suck: you haven't actually made any money until you sell the asset. You can easily end up paying taxes on something that has zero value.
rcpt 2y ago
Sometimes there's only a single tax allowed. Like in the US the federal government can only tax income unless they change the constitution. LVT as the single tax would be much harder to repeal.
- sokoloff 2y ago
  This is close to, but not entirely, true. The US federal government also has the power to levy direct capitation taxes (taxes that are effectively constant per-person without regard to any other factors). In practice, those taxes are impractically regressive, but the federal government does have that power under the Constitution.

scott_w 2y ago

This is a pretty weak argument, in my opinion: "we shouldn't do this because powerful people who don't benefit will try to undo it."

at_compile_time 2y ago
It's not an argument not to do it. I'm just pointing out that it isn't enough to make the world a better place, you need to have a plan ready for how to keep it that way or we just get captured again.
- scott_w 2y ago
  No you don’t because no plan survives first contact with reality. You simply have to keep plugging the benefits and make it politically infeasible for MPs/Congress/Etc. to undo it.