Crypto tax evasion is 'pervasive'
ft.com
ft.com
https://www.irs.gov/newsroom/treasury-irs-issue-final-regula...
IMO there should be more reasonable limits to how much you are allowed to sell before being liable for taxes. The amount of time it takes to properly file crypto taxes can be multiple hours especially if you do on-chain trading and need to report every invidual shitcoin exchange and so on.
I feel like a significant amount of the tax office's resources would be freed by just allowing something like 5€k a year to be sold tax free.
Where do these people think tax revenue goes? Into a big black hole? The money goes to pay for the justice system (which protects property rights, prevents people from killing each other), build and maintain infrastructure of all kinds (roads, bridges, mass transit, sewage systems, water treatment facilities), education, etc.
Without the government we'd be much, much worse off.
Some people using crypto are criminals, terrorists, and (perhaps less concerning albeit more numerous) tax-evaders. Some aren't.
And on the other side, some (much?) government spending is inefficient, highly-politicized, and perhaps contrary to someone's moral compass (e.g. the average American citizen sends $11.34 each year to Israel, or sends Uncle Sam a whopping $140/yr -- out of their own pockets -- to fund the 'War on Drugs' which disproportionately puts black men into prison for small amounts of personal cannabis possession). So yes, gov tax spending builds roads and defends property rights - but that doesn't mean it's all good. A reasonable person can take issue with both the size and targets of much of the spending.
Anyways, my point isn't to debate the pros/cons of particular government spending examples, but rather that the average person has not just reason but also a duty to assess how government spending happens, whether or not that aligns with their values, and to vote and organize appropriately to try to change that.
If you're already a bit more libertarian, skeptical of federal monetary policy, morally conflicted about how your tax dollars are spent, in tech with a love of technology, then ya you probably are going to like the fact that crypto is outside of the normal system.
Who is “we” here?
In some countries tax revenue goes to improving services, in some countries it goes to the President’s brother-in-law, in some countries it goes to military incursions that are morally repugnant.
Tax, like cryptocurrency, isn’t intrinsically good or bad. They are both tools that could be used for benevolent or malevolent purposes depending on who is using them.
Where I live there is absolutely no public sewage and I built my own system and so did most my neighbors, because as it turns out in our low tax libertarian enclave of mostly poor people, the vast majority prefer 10k once every few decades on a septic system over living in shit or getting in feuds with their neighbors for shitting on their road or lawn (there are no public roads here thank god). Your paranoia turned out unfounded.
Your “low tax libertarian enclave” where folks evidently can afford to drop $10k occasionally sure doesn’t sound like it’ll scale up to 12 million people.
Also you can build your own septic for 5k if you do your own work. I'm honestly in shock you'd poop in the street to save the 40 or so a month it costs at worst, considering when I lived in the city I was billed sewage and it came out about the same as the amortized cost of my septic system. The only people pooping in the streets were the homeless or the odd mentally ill person. I realize people like you are the real problem who will poop on others stuff to save a buck, but that honestly seems a mental health issue that public sewage systems wont solve.
How does this work in Manhattan? How about for a single apartment complex? It doesn’t scale. It works if you’re in a low density area benefiting from the taxes pulled from high density areas.
> Also you can build your own septic for 5k if you do your own work.
Something like 40% of Americans couldn’t field a $400 expense.
> I'm honestly in shock you'd poop in the street to save the 40 or so a month it costs at worst
You’re in shock after discussing a place where it happens?
Waste treatment system similar to many public systems. Charge by drain units, sewage pipe size, or maybe metered. Point is sewage treatment plant can be funded on individual apartment basis.
> works if you’re in a low density area benefiting from the taxes pulled from high density areas.
My area is far poorer than Manhattan but virtually everyone has a private septic system, and I've never seen poop in the street. You were previously paying for public poop now your just paying privately in lieu of publicly, and of course the homeless still probably shit in the street.
Also rural septic systems are almost never publicly funded.
>Something like 40% of Americans couldn’t field a $400 expense.
In practice in places like Manhattan you'd be paying for sewage monthly (when I lived in city that charged cost of sewage it was about 40 of my water bill). In rural areas septic is usually owned as part of mortgage or as debt services, if one cannot pay outright. All of which is amortized pretty close to real cost of sewage most anywhere.
>You’re in shock after discussing a place where it happens?
I'm in shock because having lived in areas that charge individually for sewage, the very few that don't spend the $1-$2 a day are either brutally poor or mentally ill, its just not a thing that people like you poop in the streets anyplace I've lived that charges near full rate for sewage treatment. As it were, the vast majority given the $1.40 a day to spare, will pay it to not have to poop outside or let it accumulate in their home, and if unable or unwilling to do so it is nearly always a symptom of something else that public sewers won't solve.
So we agree it doesn’t scale. You can’t have 1,000 people each digging their own septic system around an apartment complex. What you’re proposing is adding cost and complexity to sewage in order to ensure you only pay for your shit.
> Also rural septic systems are almost never publicly funded.
Indeed, but literally all of the infrastructure up and down the supply chain that makes a $5k septic system available to you is.
> In rural areas septic is usually owned as part of mortgage or as debt services, if one cannot pay outright.
Ah, so you’d rather the poor pay interest on the ability to shit? Surreal.
> brutally poor or mentally ill
Yes, and I don’t think those people ought to be unable to shit in dignity. The libertarian dream is a nightmare.
The asinine approach of using a rural septic system on a Manhattan apartment doesn't scale. Metering water consumed in most cases is pretty good at finding sewage use, and water metering exists in most apartments or at least every one I've lived in.
>...complexity...
On the contrary, your system is a complicated one that instead of metered sewage or water one has an army of tax collectors who meter our earnings & property & spending, who in practice toss people in a cage when they don't pay up rather than just stop the service.
>Indeed, but literally all of the infrastructure up and down the supply chain that makes a $5k septic system available to you is.
Sure but under my proposal everyone pays for services consumed, if you think rural people are stealing your infrastructure taxes to build septic systems by all means that's an argument to 'tax' at point of consumption, since we're cheating you apparently. (Now we know you really are against paying taxes for others poop!)
>Ah, so you’d rather the poor pay interest on the ability to shit? Surreal.
Well in practice they pay interest either way, privately or via inflation and public debt gov uses to expand their scope.
>Yes, and I don’t think those people ought to be unable to shit in dignity. The libertarian dream is a nightmare
Mentally ill and the poor shit in public largely because housing is unaffordable and it isn't convenient to have to hike a long way to take a shit. If you have democratic assent and are so sure people are eager to fund the shitting of the homeless, by all means go out and open a public shittery next to them, sounds like you'll get the support.
And this is how it already works in “most places”. Where it isn’t currently doing that you propose installing meters that aren’t already there, or determining pipe size to every user to determine the proper amount to charge for their shit. How is this not adding complexity?
> your system is a complicated one
Yes, the tax code is complicated for some small cohort of people, and that should be fixed.
> Sure but under my proposal everyone pays for services consumed, if you think rural people are stealing your infrastructure taxes to build septic systems by all means that's an argument to 'tax' at point of consumption, since we're cheating you apparently.
Sure, just as soon as you pay for all of the infrastructure between your community and the septic system. I wonder how many million or billions of dollars that would add up to.
> Well in practice they pay interest either way, privately or via inflation and public debt gov uses to expand their scope.
In practice they’re spending that money on something else. This isn’t about savvy savers losing a few percent to inflation. This is about people mortgaging a way to take a shit because they need to hook up their apartment to some company’s system.
> Mentally ill and the poor shit in public largely because housing is unaffordable and it isn't convenient to have to hike a long way to take a shit.
Huh, no restrooms available in the city? Oh wait, you have to be a customer to use a lot of those restrooms… so you have to pay to shit. Crazy how that isn’t working. It’s not libertarianism that’s wrong, it’s the damn poor and mentally ill.
? Sewage systems are built under permit virtually everywhere and the pipe size or drain units is documented. I live in about the least regulated place in the Continental US and even here my drain units are public record. Of course if everything is private connections could be added without permit since that burden falls privately.
Of course if water is unmetered and public I think the average person even worse, with tragedy of the commons and the rich or corps consuming water in mass then taxing the poor to fund it.
>Sure, just as soon as you pay for all of the infrastructure between your community and the septic system. I wonder how many million or billions of dollars that would add up to.
This doesn't make sense. You tax this in pieces, you can 'tax' at consumption in pieces without each consumer building their own billion dollars in infrastructure. If your local companies are selling PVC pipes and Portland cement to country folk, why aren't you charging them for that infrastructure instead of complaining about maybe poorer people are getting a slight discount on poop system materials at your cost (which you seem to think is good anyway, personally im noy sure how much im robbing you when i privately buy portland and pvc, but corporations siphoning tax money via subsidies etc can be a problem).
>In practice they’re spending that money on something else. This isn’t about savvy savers losing a few percent to inflation. This is about people mortgaging a way to take a shit because they need to hook up their apartment to some company’s system.
... Apartment owners mortgage the cost of their sewage pipe yes, as well as the toilet they sit on. If renting landlord pays for the pipes you rent and indirectly also pay for. This is the case whether you connect to a public or private system, taxes or not. You are not mortgaging the cost of the treatment system unless you own it.
>Huh, no restrooms available in the city? Oh wait, you have to be a customer to use a lot of those restrooms… so you have to pay to shit. Crazy how that isn’t working. It’s not libertarianism that’s wrong, it’s the damn poor and mentally ill.
If you want shitters for the homeless why don't you buy them some? Or if it's so wildly popular a cause why not solicit donations? Taxes haven't been very successful at solving the problem and you have it all figured out so you should spearhead it. How much are you committing today for shitters for the homeless?
You’re just repeating what I’ve already said. This already happens, but where it doesn’t you must add a bunch of overhead to make it work.
> You tax this in pieces, you can 'tax' at consumption in pieces without each consumer building their own billion dollars in infrastructure.
That is easy to say when you _already have_ tax payer funded infrastructure to start with. If you include the costs of building all the roads, ports, rail, as well as all the tax payer services that make it reasonable for employees to live in cities near the factories this stuff is made. What I’m trying to point out here is that your $5,000 shitter is going to be significantly more expensive once that’s taken into account. You are freeloading on work already paid for by others in order to make your libertarian idea remotely feasible.
> Apartment owners mortgage the cost of their sewage pipe yes, as well as the toilet they sit on.
Not talking about owners, I’m talking about renters. I’m talking about people who really ought not to have to make the decision to go into thousands of dollars of debt in order to shit just so you can say you didn’t have to contribute.
> If you want shitters for the homeless why don't you buy them some?
Because I couldn’t afford to. I’m not rich. However, society can.
> Taxes haven't been very successful at solving the problem
This is, at best, wild speculation. We do pay taxes, taxes are used to assist and shelter the homeless. You’re saying that because it hasn’t completely solved homelessness then it’s worthless and your little libertarian faction should be able to reap all the benefits of the things paid for by cities and pay nothing back into it.
The good news is that will never happen because it is so popular to provide social benefits through tax payer funds. Most people are unwilling to be such ardent boot lickers of the wealthy.
Unmetered water/sewage access is not popular with taxpayers and likely would be a regressive tax in favor of wealthy/corps.
> You are freeloading on work already paid for by others in order to make your libertarian idea remotely feasible.
If companies selling septic system materials rural people buy are freeloaders, this is something your jurisdiction is going to have to deal with and hopefully fix, as making out sewers public is still going to result in our people buying PVC and Portland cement from your businesses. Your issue here is not with our sewers but that you've failed to control externalities of your businesses.
>Because I couldn’t afford to. I’m not rich. However, society can.
Many taxpayers can't either. Yet you want to force them to when even you won't do it!
>. You’re saying that because it hasn’t completely solved homelessness then it’s worthless and your little libertarian faction should be able to reap all
I've said exactly what I've said. Sure you could use taxes and build a shitter next to every homeless tent (of course you admit you taxpayer have no money for that). The problem is in part housing is unaffordable, in large part due to regulations, zoning, codes, TAXES, and of course in the case of public sewers the difficult task of convincing a bunch of NIMBYs to allow their tax funded homeless bathroom to be built next to them.
I'm empowering you, since people are so willing to go along with it that they'll vote for the taxes, by all means go ahead and start a private charity and fulfill your dream. Better than what you're doing now, which is complaining to people like me who've actually personally funded and built sewage systems about how I'm a freeloader and if you could just steal enough money from others you could fulfill your goals without expending any efforts or your own money.
And is already extremely rare. However, what you are advocating for is retrofitting these systems in order to support your pay-for-shit plan.
> Your issue here is not with our sewers but that you've failed to control externalities of your businesses.
You are missing the point. The issue is that this system you want to move to will be built upon a system that uses taxation to fund infrastructure. Your assertion that this is a better system falls apart if you don't use any infrastructure that was funded by tax money. In other words, if everything was taxed at use from the get-go, your septic tank would _not_ cost $5k. It would be much more expensive as the costs of building/maintaining all the things we currently have would be built directly into the septic system cost instead of from tax revenue largely pulled from the wealthy.
> Many taxpayers can't either. Yet you want to force them to when even you won't do it!
This is so disingenuous as to border on lying. What you're saying is that everyone, even the desperately poor, need pay for anything they use so that you don't have to help anyone. What I'm saying is that progressive taxation is the way to pay for public goods so the poor are spared burdens the rest of us can handle.
> I've said exactly what I've said.
Indeed, and it's the typical nonsense said by libertarians who benefit from public funds and are too ignorant or simply refuse to recognize it. So self centered that they can't even recognize the massive disparity between how little they pay in taxes and how much more they receive when compared to people who live in large cities.
> if you could just steal enough money from others
There it is! "Taxation is theft". You live in a republic, suck it up, and enjoy the sewage system you were able to personally fund on the backs of everyone else.
Is that the latest euphemism? Tell me, where can I get the money? A lot of it, please.
Fiat dominates in strong nation states because in part everyone needs it for taxes.
There's an old quote along the lines of "One often meets his destiny on the road he takes to avoid it". First said, probably, by Jean de La Fontaine in the 17th century, but probably more widely known from its use by Master Oogway in "Kung Fu Panda".
It is not hard to think of ways that governments could stop much crypto tax evasion, at the cost of a general lowering of financial privacy. The crypto world might think that people would not put up with that, but most people already willingly give up much financial privacy for the convenience of credit and debit cards.
For most people its not all that big a leap from the amount of privacy they have given up to their bank for a credit card and the amount of privacy they'd have to give up to allow tax evaders to be stopped, and if their taxes are higher because of too much crypto tax evasion they will have no problem making that leap.
https://cc.bingj.com/cache.aspx?d=3704096032869&w=SxACgOAl0H...
FT calls crypto "hopium".
At this point I'd rather form my own army and build my own highways and teach my own children than pay for entrenched bureaucrats to further entrench themselves along with the powerfully wealthy.
Let's be real here. With compounding, total taxation takes away 90% of income. If that's not theft, I don't know what is. There would be an appropriate level of taxation that would be fair, perhaps 10%.
* I think that the 4% number is dubious but it's not material to the question.
So you can't argue that lack of savings under the current system implies no savings under a low-tax system. It is pretty reasonable to suggest that a big contributing factor to the lack of savings is precisely what the tax system does to savers.
That does not compute.
Perhaps you could explain that.
It says the answer is a 90% loss (not 99% or higher), which still is quite bad. Again, this is pending me doing the calculations myself.
Regarding taxes, a total tax burden of 50% was used to account for all taxes (income, sales, property, etc.)
Even this calculation by GPT doesn't take into account the "investment gain" taxes one would have to pay at the end, which would bring the loss percentage above 90.
If someone is taxed and doesn't or can't save, or their retirement gets screwed up, or they make enough to get taxed but not enough to invest significantly, or finds themselves in any of a myriad of screwy situations, then they only make 5-7% by diligently saving up the same amount that the first two would have been investing year over year.
95% of their potential income is lost by not investing reasonably. If someone were magically able to not pay taxes, they gain 150% of the good-retirement investment and taxes scenario.
Given the constant nickel and diming, the gotchas, the shuffling of money back and forth, and the outsized impact on investment, I completely agree that a flat 10% absolute level of taxation, not a red cent over, would be reasonable. It's also super important to invest, and to keep dropping money into your investments over time that you never touch, just use a diverse and sensible fund, and don't pull it out until you retire.
Not only is it theft of the future, it's wasted and misspent in awful ways. Sure am glad all our representatives are getting so wealthy, though. Wonderful people, that lot.
It might be too complicated to say. Someone who doesn't pay income tax, maybe. Depending on assumptions.
But I worked out at some point that >50% of my time spent working was being redirected towards the tax office - my income because it was taxed when I earned it (+ any stealthy payroll taxes), taxed again when it was spent and if it was invested in the middle it got taxed a third time for fake "capital gains" from money creation.
When you look at government spending (typically 40-50% of GDP in the West) and consider that most of that is probably malinvestment (by lack-of-alternatives-to-tax they're taking from the most economically productive members of society) you've probably lost more than half your wealth vs a no tax society. There is friction everywhere.
If you search around for crypto tax software, you'll find there's actual demand from people that want to pay taxes on their crypto.
I think that’s more of a “need to” thing rather than “want to”, yes even for the people that aren’t using crypto for criminal activity.
In fact, I would love to see some of the "lol taxes" people have some enforcement action taken against them.
The only reason wage-tax "compliance" is so high is because there's a system in place to automatically extract as much tax as possible and make you file a refund for the difference.
I think you would find equal amounts of "non-compliance" in any cash or barter based business.
Go try to buy some crypto in the US without KYC. It's already pretty tightly controlled.