Hacker News Reader

Comment by more_corn | Hacker News Reader

How about no tax on people below the poverty line? When I was young it always killed me to make so little and still pay taxes.

View on HN

Isn't that essentially already the case in the USA? The standard deduction for a single person is $14,600/year and the federal property level is very close to that at $15,060/year.

It's kind-of weird how these levels are set equal nationwide... as there are regions where this is a decent living and one could own a small single family home or condo, an older but reliable car, and eat well on that salary... and places where you would be homeless and have no day to day security or stability required to even keep a job.

Are you being serious no one eats well on $15k/year.

Nonsense.... I lived on under 10k/year for close to a decade in rural Oregon- a while enough ago that that would be about $14k/year now adjusted for inflation.

I had a decent 2 bedroom apartment, two older but reliable cars I got for nearly free at auto auctions and a fast motorcycle, and cooked my own meals 3x/day from top quality local farmers market ingredients. I'm talking REALLY good food, the best quality fresh local meat and vegetables money can buy, that was the one thing I would not compromise on.

I traveled a lot for fun also, but it was in my own (very fuel efficient) vehicles, cooking for myself on a camp stove while traveling and I could only afford restaurants a few times a year.

Almost all of my possessions like furniture, etc. were high quality things I had slowly sourced for free over craigslist, with some dumpster diving and word of mouth. Mostly high end vintage hardwood stuff that looked expensive- Rich people don't sell that stuff, they give or throw it away.

Personally, I felt like I was living very comfortably, and I quite enjoyed the challenge of living frugally. I felt a bit smug about how I creatively found ways to have pretty nice things, and a nice lifestyle without much cost.

I'll add that nowadays I'm into 'sea foraging' and can jump in the ocean with a mask and a pole spear and eat like a king for free in a few minutes.

I think if you look you'll find that housing costs have rapidly outpaced inflation, even in rural Oregon. Studio flats in La Grande are approaching a thousand dollars a month. I believe what you're saying is true, but I don't think the experiment could be replicated today.

You're probably right- I had a nice place much bigger than I needed and walking distance from work in one of the more expensive and desirable rural Oregon small towns for under $400/month!

However, there are places more affordable than Oregon... I recently looked at home prices in the Mobile, AL area and it looks like you can buy a livable 3 bedroom home for ~$60k there- that could be about $400/mo for a mortgage.

If one has the skills and knowledge to do so, you can still live very cheap on a boat almost anywhere- I know a lot of people with incomes in this range living on well maintained ~30 foot sailboats, even in the SF Bay area.

A lot of what I'm talking about is substituting skills and free time for income. If you are good at DIY stuff, cooking, etc. you can live better for cheap. I only have those skills because I grew up upper middle class, and had parents that taught them to me- and I was in boy scouts, etc. You also have to have a lot of free time- if you're making $14k/year part time with no kids, it's totally different than if you're working full time and have kids- although the minimum deduction and poverty line will be higher with kids.

I have friends that grew up poor with absent parents, and their lives are much more expensive than mine in many ways- they can't maintain an older car so they have to buy a newer one, they can't cook so they eat out more, etc.

There is argument against and in favour. France works like that and it means a lot of people don’t pay taxes and in return don’t feel very connected to the state spending. It’s weird but I think a token amount of tax completely offset by state handovers is preferable to no tax purely from a mind set point of view (you too are part of the collective and contribute to the working of the state).

The whole thing is a bit disingenuous anyway when so much of tax revenue actually comes from VAT and other indirect taxes.

I always found it strange that modern socialists and leftists are very supportive of income taxes, even though it is a dreadful burden on those people who have to work for their survival. Why wouldn't leftists instead be more for taxes and tariffs on land, on commerce, on natural resources or on luxuries?

The funny thing is that one of the goals of the communist party in the Soviet Union was to abolish all income taxes! Khrushchev even lamented later that they couldn't reach that goal. I suspect many hackers would have loved to be members of the Supreme Soviet, but how would they have reacted when Khrushchev suggested to abolish all income taxes?

one reason is that it's hard for a leftist to imagine a world where people making millions or billions to have a 0% income tax rate

People don't make millions or billions on working and receiving a salary.

> I always found it strange that modern socialists and leftists are very supportive of income taxes, even though it is a dreadful burden on those people who have to work for their survival

What? We did "trickle-down" economics before. Surprisingly enough, it didn't work. At all.

Also, back in the 1950s/60s, we thoroughly soaked the rich and got to go to the moon[0]. Then the 1970s came around and the new gen of wealthies were all "yeah nah, that sucked, let's do something about it!"[1]

[0] in b4 "it's way more complicated than that!!1~"

[1] https://wtfhappenedin1971.com/

When I say it's a dreadful burden, I mean it. For people doing physical labour and relying on their work for survival, they know exactly how much blood, sweat and tears they had to give for each dollar taken from them in taxes. For the people relying on real estate price appreciation for their income, taxes are more of an abstract.

That's pretty hard to do when the absolute majority of the sum of taxes is paid by poor people. Even if you taxed the rich at 99%, it would be short by orders of magnitude - and then of course you have to consider https://en.m.wikipedia.org/wiki/Laffer_curve

Also, there's a distinction between people below the poverty line, and young people making little wages in their early jobs. Why shouldn't we tax the rich kid working at McDonald's because their trust fund requires them to work for a decade before they get access to it?

Interested in digging deeper, do you have a source for this:

> That's pretty hard to do when the absolute majority of the sum of taxes is paid by poor people. Even if you taxed the rich at 99%, it would be short by orders of magnitude

The Laffer curve is just kind of made up. He just said "I believe this is how it should work" and then tried to make it work, even though it never quite does. And it often turns in results that its proponents don't like.

When you account for all taxes this may be true but for just income taxes it isn’t. According to the link below the bottom 50% makeup just 2.34% of income taxes paid. So, eliminating income taxes and maybe adding a return free filing option for the bottom 50% of households looks super doable.

Source: https://www.ntu.org/foundation/tax-page/who-pays-income-taxe...

Income taxes don't affect every person equally though. Plenty of Very Rich people earn zero income.

Yep and that is a separate issue that needs to be addressed. When you have people who are so wealthy that they can switch their nationality on a whim then that requires special solutions.

From the perspective of government receipts, the bulk of taxes are paid by the middle, not the tails. The rich don't have enough numbers, and the poor don't have enough money, to offset the area under the middle of the curve. This isn't true everywhere, but is true in the US and most developed countries.

your first point is the only thing this whole discussion should be about... the second one is insanity :)

Reply on news.ycombinator.com