<story><title>G7: Rich nations back deal to tax multinationals</title><url>https://www.bbc.co.uk/news/world-57368247</url></story><parent_chain><item><author>lars512</author><text>As an Australian who moved to Sweden, I was amazed at how efficient the Swedish income tax process was. The government already knew everything they needed to calculate your return, and gave it pre-filled. There were not endless exemptions. Nobody at my work used an accountant, most approved their tax with a few clicks and were done. So much more efficient than in Australia!</text></item><item><author>MrPowers</author><text>The deadweight loss of taxation is much lower for a land tax than an income tax.  The deadweight loss is the economic resources allocated to complying with the tax.  The armies of tax lawyers would be able to perform other economically productive activities if they weren&amp;#x27;t pouring over the tax code.&lt;p&gt;Pigovian taxation is even better.  Taxing gas is a great example.  Gas consumers emit carbon which has a cost for society.  We should make them pay for this negative externality via a gas tax, so their consumption is economically optimal.  This is how to prevent the Tragedy of the Commons.&lt;p&gt;I&amp;#x27;d argue that some taxes are objectively better than others and not all equally wrong.</text></item><item><author>PaulRobinson</author><text>If you’re going down this route, many will argue that all forms of income tax are equally “wrong”.&lt;p&gt;Henry George - a 19th century political economist - proposed exactly this, and suggested the only thing that should be taxed should be land: impossible to hide from a tax inspector, potentially a waste to the public commons if useful land that could be exploited isn’t and you can even protect land you wish to keep pristine more easily (tax it very, very highly).&lt;p&gt;His ideas are now considered eccentric, but I do wonder if the World would be a great deal simpler if globally we moved to a Henry George system and stopped trying to tax sales, income and everything else going we do.</text></item><item><author>rjknight</author><text>I do wonder if we wouldn&amp;#x27;t be better off eliminating corporation tax entirely.&lt;p&gt;The revenue of a corporation can, roughly, be:&lt;p&gt;1. Spent on goods or services from another company (including freelancers, contractors, etc.)&lt;p&gt;2. Spent on rent&lt;p&gt;3. Spent on capital purchases&lt;p&gt;4. Spent on wages&lt;p&gt;5. Spent on debt repayment or other forms of financing&lt;p&gt;6. Paid out in dividends&lt;p&gt;7. Spent on share buybacks&lt;p&gt;8. Invested in something else&lt;p&gt;Items 1-5 are all good things that we want companies to do, and corporation tax is normally applied after this spending is accounted for. Items 6 and 7 ought to be taxed, and frequently are (dividends and buybacks create income for individuals who will pay tax on that income). Item 8 is a bit vaguer, but probably shouldn&amp;#x27;t be taxed in most cases (if we&amp;#x27;re worried about companies parking cash in very low-risk assets, then super-low yields are effectively a tax on that anyway).&lt;p&gt;All that the corporation tax adds to this picture is the creation of work in tax avoidance services, and an unjust inequality between those firms that can afford those services and are structured to take advantage of the rules, and those that can not and are not.&lt;p&gt;It&amp;#x27;s not obvious to me that corporation tax &amp;#x2F;can&amp;#x2F; be fixed, and so it may be better simply to scrap it and replace it with something more difficult to dodge.&lt;p&gt;EDIT: formatting</text></item></parent_chain><comment><author>gambiting</author><text>In the UK if you&amp;#x27;re in full time employment and only have one job, then there&amp;#x27;s literally nothing to do. Not even clicking somewhere to approve your tax return - your employer does it all for you. I know people who are literally unaware when the tax year ends because they never in their entire adult lives had to do anything with the tax return - it&amp;#x27;s just completely irrelevant to a normal working person. And on the ocassion that you have to fill one out for whatever reason, most of it is already prefiled from the information HMRC holds about you already.</text></comment>
<story><title>G7: Rich nations back deal to tax multinationals</title><url>https://www.bbc.co.uk/news/world-57368247</url></story><parent_chain><item><author>lars512</author><text>As an Australian who moved to Sweden, I was amazed at how efficient the Swedish income tax process was. The government already knew everything they needed to calculate your return, and gave it pre-filled. There were not endless exemptions. Nobody at my work used an accountant, most approved their tax with a few clicks and were done. So much more efficient than in Australia!</text></item><item><author>MrPowers</author><text>The deadweight loss of taxation is much lower for a land tax than an income tax.  The deadweight loss is the economic resources allocated to complying with the tax.  The armies of tax lawyers would be able to perform other economically productive activities if they weren&amp;#x27;t pouring over the tax code.&lt;p&gt;Pigovian taxation is even better.  Taxing gas is a great example.  Gas consumers emit carbon which has a cost for society.  We should make them pay for this negative externality via a gas tax, so their consumption is economically optimal.  This is how to prevent the Tragedy of the Commons.&lt;p&gt;I&amp;#x27;d argue that some taxes are objectively better than others and not all equally wrong.</text></item><item><author>PaulRobinson</author><text>If you’re going down this route, many will argue that all forms of income tax are equally “wrong”.&lt;p&gt;Henry George - a 19th century political economist - proposed exactly this, and suggested the only thing that should be taxed should be land: impossible to hide from a tax inspector, potentially a waste to the public commons if useful land that could be exploited isn’t and you can even protect land you wish to keep pristine more easily (tax it very, very highly).&lt;p&gt;His ideas are now considered eccentric, but I do wonder if the World would be a great deal simpler if globally we moved to a Henry George system and stopped trying to tax sales, income and everything else going we do.</text></item><item><author>rjknight</author><text>I do wonder if we wouldn&amp;#x27;t be better off eliminating corporation tax entirely.&lt;p&gt;The revenue of a corporation can, roughly, be:&lt;p&gt;1. Spent on goods or services from another company (including freelancers, contractors, etc.)&lt;p&gt;2. Spent on rent&lt;p&gt;3. Spent on capital purchases&lt;p&gt;4. Spent on wages&lt;p&gt;5. Spent on debt repayment or other forms of financing&lt;p&gt;6. Paid out in dividends&lt;p&gt;7. Spent on share buybacks&lt;p&gt;8. Invested in something else&lt;p&gt;Items 1-5 are all good things that we want companies to do, and corporation tax is normally applied after this spending is accounted for. Items 6 and 7 ought to be taxed, and frequently are (dividends and buybacks create income for individuals who will pay tax on that income). Item 8 is a bit vaguer, but probably shouldn&amp;#x27;t be taxed in most cases (if we&amp;#x27;re worried about companies parking cash in very low-risk assets, then super-low yields are effectively a tax on that anyway).&lt;p&gt;All that the corporation tax adds to this picture is the creation of work in tax avoidance services, and an unjust inequality between those firms that can afford those services and are structured to take advantage of the rules, and those that can not and are not.&lt;p&gt;It&amp;#x27;s not obvious to me that corporation tax &amp;#x2F;can&amp;#x2F; be fixed, and so it may be better simply to scrap it and replace it with something more difficult to dodge.&lt;p&gt;EDIT: formatting</text></item></parent_chain><comment><author>throwaway894345</author><text>The American tax system is similarly frustrating. I’m a senior engineer and I have a hard time navigating tax forms even with the help of Intuit, and it frustrates me that I have to pay Intuit (or someone else) to help me do taxes which are complicated in large part because Intuit et al lobby for complex tax codes and against the sort of Swedish model you describe.&lt;p&gt;Worse, when I moved to Chicago the state of Illinois &lt;i&gt;wouldn’t even accept my taxes electronically&lt;/i&gt; because their form required one of a handful of authentication methods—the only one of which that ought to have worked for me was to use my Illinois driver’s license number—a 12 digit sequence; however, their form only permitted 8 digits. It was a significant hassle just to get them to take my money.&lt;p&gt;I’ve also had difficulties figuring out how much to withhold. In the US they give us a form that calculates “allotments” (or something—I forget the term) but it’s unclear whether more of those correspond to more or less withholdings and in any case the form computed incorrectly for me for several years (I’m sure it was user error somehow and senior engineers are just not reliably smart enough to figure it out, even with the help of HR) and I would end up owing thousands in taxes as well as a separate penalty for not withholding enough.&lt;p&gt;It’s maddening that our government makes it so difficult for earnest people to pay their taxes.</text></comment>