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Comment by stonemetal12 | Hacker News Reader

>if you undervalue a thing to pay lower taxes then you risk losing it at that price. This sounds incredibly simple...

That doesn't sound so simple to me, everything has to be for sale all the time and\or you over pay on your taxes. Value your vehicle at market rate to pay the "right" taxes, anybody in the market for a vehicle can come buy yours at $1 over market rate if they want to. (It costs 2$ to drive to the closest one being sold at market rate, so it makes economic sense.) The only way to even partially defend yourself is to value your property way over market rate and pay taxes higher than the market value would suggest. Basically you have to value your stuff at market rate plus how much I would be annoyed to loose said item.

Piss off a billionaire? Guess who is never going to live indoors again.

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You also have the silly situation where everything I own is worth more to me than it is worth - otherwise I'd have not bought it.

And even if my car is worth $5k, not having to sell it and buy another one (even if I can find it) is worth a premium.

It's likely that something like Harberger taxes could work in certain situations, but not normal people ones.

This is actually the solution, not the problem. You seem to be assuming that the "correct" amount of tax to pay is the amount which is based on the market value of your asset. But the correct amount of tax is actually the amount which is based on the asset's value, to you. This keeps Blackrock from swooping in and buying up everything you own, since it's only worth market value to them.

It also doesn't make the tax onerous; a revenue-neutral switch from our current taxation scheme to harberger taxes would be revenue-neutral, whether it was based on market value or personal value.

Blackrock would definitely never swoop up a whole class of assets and then something to inflate the prices. /s

I disagree that the tax isn't onerous, but mostly from an administrative overhead perspective.

Like many people I'm taxed at source with minimal options to change my tax bill. I pay the going rate, as per the rules. Putting the obligation on me to do a bunch of work and worry about correctness would be a huge source of frustration and unhappiness.

If you're in the US, and you do the slightest bit of investing, your income tax is enormously complicated in comparison to a harberger tax, and fraught with potential penalties for gettting any of the numbers wrong. For a harberger tax, you only have to come up with 1 number, and you're the only one who decides whether that number was right or wrong.

If you mess up an income tax, it's easy to get your house taken away and auctioned, with $0 of the proceeds going to you. If you mess up a harberger tax, you get all the proceeds from the sale at a price which you literally just said you'd be happy to sell for.

The frustration and uncertainty isn't nothing; but I think if you were on the harberger system your whole life, and someone asked you if you wanted to switch away from it to the current US tax system, you'd laugh in their face.

But wouldn't the billionaire only be able to do that by continually overpaying for all your assets? I would _love_ to have someone like that around. This is not even a complicated trade.

"Oh no, I'm devastated. You bought my objectively 300k house for $1M bc I evaluated it that way. Whatever shall I do?" goes and rents a nice apartment in a large complex that's valued at $500M

But that's not how it'd work in practice.

In practice the spiteful billionaire will monthly send you offers $10K over the higher of your estimate or fair market value. So you'd be moving every month and incurring all the moving costs continually, or just continually dealing with the legal dealings of such an offer.

The transaction closes and the billionaire just sells the house at a small loss. The situation is asymmetric because the billionaire never actually uses the house.

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