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Comment by daenz | Hacker News Reader

>I don't think I could fully embrace the Amish way of life but I suspect my local community mostly farmers and ranchers could implement a barter system if we had to.

Funny thing, bartering is still subject to taxes from the IRS[0]

0. https://www.irs.gov/taxtopics/tc420

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bartering income, that's funny I always perceived bartering as an equal trade of no net difference. But that may be a perceptual thing, the value to the individual is equal but perhaps not on the open market of whatever the corresponding price tag differences are on the two goods?

>Both parties must report as income the value of the goods and services received in the exchange. [0]

My understanding of it is the good/service you receive is considered income at the fair market value, regardless of what you traded for it. I suppose if you gave a good/service away to "purchase" something as a business expense, you could deduct the value of your good/service on your taxes. But IANACPA

0. https://www.irs.gov/newsroom/four-things-you-should-know-if-...

Any purchase is definitionally an equal exchange of value. It is still income.

So the income tax is essentially a ~30% transaction fee. Imagine a world without that deadweight loss.

https://en.wikipedia.org/wiki/Deadweight_loss#Deadweight_los...

Yeah it’s inefficient, but that “deadweight loss” gives you the common infrastructure required for a modern society (roads, police, fire, et al)

In the US nearly all of your examples of what we get in return are funded by sales and property taxes

Specifically, roughly 70% of the federal budget is spent on the military, social security, medicare, and medicaid.

Not to mention a gigantic military budget including all the alphabet agencies... all funded by that inefficiency.

Perhaps there is a way to pay for these things besides taxes? Unthinkable!

Costs are deducted though, so it is only 30% of the profits.

Technically everything is a cost, though, right?

These things are precisely defined in accounting terms though. Whatever you bartered away had a cost basis, and whatever you got in exchange has a fair market value. The difference is income.

What if you live in a closed bartering community of abstract economic business entities and everything is a cost basis for something else?

Not if you don't tell them about it.

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