Hacker News Reader

Comment by alkonaut | Hacker News Reader

Because it's cumbersome enough to use cash. My main problem with cryptocurrencies isn't that it's used by organized crime, but that it risks eroding public trust in the tax system. In high tax/high trust systems, that can be disastrous.

View on HN

Is it a bad thing? Maybe taxes shouldn't be a thing, or should be low enough that it's easier to pay them than to dodge them?

One of my problems with taxes is that it's essentially a free, automatically-replenishing pool of money for stupid politicians/government officials to spend recklessly (often prioritizing short-term wins that give them the most political clout) without the "pressure" a typical business in a competitive environment faces to use their money in the most efficient manner possible.

So we should throw away public spending because people can't be bothered to check on their politicians once in a while?

Very few low-tax countries are pleasant to live in for the average human being. Clamors for low tax are inevitably made by millionaires or misguided people that believe they might one day be millionaires. Taxes exist for a good reason and have a demonstrable positive effect on the societies where they are levied. Trust in politicians doesn't factor into that, as taxes are generally spent by government officials.

> taxes are generally spent by government officials

By politicians I meant to include government officials; I've edited my comment to reflect that.

> Very few low-tax countries are pleasant to live in for the average human being

I agree, but I don't see the current situation being great either; I think the countries where high taxes are demonstrably increasing quality of life are outliers, and similarly you can increase QOL without a significant (or any?) raise in taxes.

My point is that in my opinion taxes break the typical market dynamics (that private companies are subjected to) that incentivise the entity (the company, or in this case the government) to spend their money in the most efficient way possible. Instead, taxes are seen as a near-infinite pool of money you can afford to burn with no ill effects because it'll just keep replenishing itself forever.

A recent example in the US another scam going around is the "Solar Roadways" which the electronics engineering community has debunked years ago and yet they recently secured yet another grant from the DOT to burn public funds on something that is known to not work (give this fact, the only reason it was chosen is because someone in power wanted to take advantage of this opportunity to show their support for sustainability/renewable energy/eco-friendliness to gain more political support).

If you pull up a list of countries by tax rates and some quality of life index they seem to be pretty corrolated so I would not say it is an outlier, where as the outliers are those with low tax and high QOL for example UAE, Oman and Qtar, but all those have a pretty significant income in another way compared to most countries.

>> If you pull up a list of countries by tax rates and some quality of life index they seem to be pretty corrolated

Try correlating restrictive immigration policies and quality of life index. Should we tax people a lot and make it very hard for immigrants to become citizens? Scandinavian countries do precisely both.

> make it very hard for immigrants to become citizens? Scandinavian countries do precisely both.

As a Swede, all I can say is..."excuse me, Wat"?

Compare the racial makeup of Sweden and immigration policies (citizenship, not permanent resident) with the United States.

Compared to the US almost every country has lax immigration policies. Specifically for Sweden, I would say that it doesn't have significantly more strict immigration policies (language, job skills that are required) than any other EU country that someone would actually want to emigrate to.

I think you have the causation backward. The poorer the country the less of a cut the government can take without bringing everything crashing down. These places are low tax because they cannot afford to be high tax.

If you look at local taxes and fees between US cities the same pattern emerges.

I think this is exactly right. Low tax jurisdictions are also often desperate to attract business. Mobile people are willing to pay high tax only when they get something else like stability and high quality of life

The US is wealthy, has lower taxes, and lower happiness than similar countries

Maybe in the nice countries taxes are high because it's possible for them to be high, what with it being a nice country full of nice rich people that accept to be taxed.

Maybe in not-so-nice poor countries (which again means the people, we're not talking about the landscape here) the goverment would love nothing more than to raise taxes but it's impossible for them because the people just won't take it.

Oh, and if you're still thinking the other way around: No, starting with high taxes doesn't work to make your not-so-nice country into a nice one (Google "Communism")

Low government spending as a percentage of GDP is strongly correlated with higher rates of economic growth [1], which is a strong indication of a well-functioning society.

[1] https://web.archive.org/web/20170821004405/http://ime.bg/upl...

It's still easy to use cash for everything in a lot of countries

Taxes are corrupt. I profited from a publicly funded project in CA and the abuses were atrocious. You should minimize your tax burden as much as possible.

Reply on news.ycombinator.com