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Perhaps all taxes should be abolished and then a new one introduced: a transaction tax. The question then remains, does the sender add a bit more before sendin

Perhaps all taxes should be abolished and then a new one introduced: a transaction tax. The question then remains, does the sender add a bit more before sending to move any given amount, or do they pay a given amount with the recipient getting less? The system certainly scales well for net-worth and one's economic activity. The question then remains - who/what is considered an "outside" party for a tax to operate in financial flows? It could work well in an agentic economy if agents are considered as a single entity with flows not taxed between them.

Hnrobert42 5mo ago
Transaction taxes are considered regressive. That is, they disproportionately affect the poor. The idea is that everyone must spend a certain amount of money to live. For the poor, that amount is a greater proportion of their total income and wealth. Basically, a wealthy person can choose to pay the same taxes as a poor person by only spending as much as a poor person. Maybe that's fair. Maybe it's not. But it is a criticism of sales/transaction taxes.
- adrianwaj 5mo ago
  That's true, the only thing I can think of is an "amplification curve" being set on whatever is paid, and that can be paid by everyone after any given period based on all the flows a person was involved in during that time. So if a frugal rich person can be paying a similar amount to a poor person in overall tax looking at living expenses alone, one can also look at all the extra income the rich person gets from assets. So this inequality/imbalance can be lessened through an amplification factor: by looking at the overall position of a person's flows. The governments can decide how much to "squash down" down the inequality in society. Would this address the issue raised? The other thing interesting about a transaction tax is that individuals don't necessarily even need to be identified - only flows. That would suit the privacy-side of crypto. But I'm not sure how the final setup would look. And that could appeal to the super-rich who want to remain anonymous. Maybe what I'm getting at is a blockchain tax: a proportion of transaction fees gets automatically routed to government coffers. Alternatively, add a staking tax as well. This will all make more sense when more real-world assets go on-chain.
  - deleted 5mo ago
    [deleted]

Hnrobert42 5mo ago

Transaction taxes are considered regressive. That is, they disproportionately affect the poor. The idea is that everyone must spend a certain amount of money to live. For the poor, that amount is a greater proportion of their total income and wealth. Basically, a wealthy person can choose to pay the same taxes as a poor person by only spending as much as a poor person. Maybe that's fair. Maybe it's not. But it is a criticism of sales/transaction taxes.

adrianwaj 5mo ago
That's true, the only thing I can think of is an "amplification curve" being set on whatever is paid, and that can be paid by everyone after any given period based on all the flows a person was involved in during that time. So if a frugal rich person can be paying a similar amount to a poor person in overall tax looking at living expenses alone, one can also look at all the extra income the rich person gets from assets. So this inequality/imbalance can be lessened through an amplification factor: by looking at the overall position of a person's flows. The governments can decide how much to "squash down" down the inequality in society. Would this address the issue raised? The other thing interesting about a transaction tax is that individuals don't necessarily even need to be identified - only flows. That would suit the privacy-side of crypto. But I'm not sure how the final setup would look. And that could appeal to the super-rich who want to remain anonymous. Maybe what I'm getting at is a blockchain tax: a proportion of transaction fees gets automatically routed to government coffers. Alternatively, add a staking tax as well. This will all make more sense when more real-world assets go on-chain.
- deleted 5mo ago
  [deleted]