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Discussion #41 - Taxes

First introduced in the early 1900's, there is nothing inherently evil about taxes. If they are fairly implemented across the entire income/wealth spectrum, they can actually quickly pull a country out of extreme poverty. The problem is, this rarely (if ever) happens. Even in the richer countries, historically and currently the ultra-wealthy corporations and individuals rarely pay their fair share of taxes. The scope and magnitude of this situation is actually much larger than most people think. The super-rich in our world are in many cases paying virtually no taxes, and most of the world's assets and income are in the hands of these individuals and companies.

In fact, if the tax laws were tweaked to make them fair, many countries could pay off their entire government debts in less than ten years. Instead, virtually all of the tax burden has been and is squarely placed on the shoulders of the middle class. An economic group that is quickly shrinking in many areas of the world.

The main reasons why this legal form of corruption is occurring is due to the assistance of extremely clever accountants and lawyers, and the common form of blackmail that exists when a company threatens to relocate. They threaten to move elsewhere (taking their jobs with them), and we are politely informed that major tax breaks or incentives are/were required to keep them from leaving. Also, I'm pretty sure that most countries can afford some fairly clever lawyers and accountants themselves.

Most ultra-wealthy individuals or families are earning most of their income from investments, which are subject to capital gains tax and not income tax. Modifying this one tax law would itself make a massive difference. There are a few extremely wealthy people who recently have been begging their governments to tax them more. These are (in most cases) some extremely intelligent people, who know that all of this short-term greed is going to lead to some extremely long-term economic pain very soon.

When you add up all of the forms of tax that the vast majority pay, it amounts to a HUGE percentage of total gross income. On top of the income tax, there is sales tax, property tax, gasoline tax (typically half), sin taxes (alcohol & Tobacco), energy taxes, tariffs (customs & duties which are effectively a pre sales-tax tax), and can be upwards of 30%! The list goes on and on. When you consider that many countries did not even use most of these taxes until World War 2, it seems pretty extreme to most people. Knowledge is power, and creates political will. We musn't assume that we have no say or influence over what happens in the taxation department. Complacency is a very dangerous thing, and ignorance is never bliss.

Thanks to "The Panama Papers", we're taking a huge leap in microevolution as human beings in this area. We're starting to wake up and smell the coffee in how ridiculously naive and ignorant most of us are to the massive amount of financial corruption that has been going on, right under our noses, since the '70's. An incredible number of brilliant and upstanding financial professionals have been enabling, assisting, encouraging & profiting from this corrupt (yet most often legal) nonsense for a very long time. The only reason why the ultra-rich have been getting away with these aggressive tax avoidance schemes for so long, is because we've been letting them.

Added to this, is the harsh reality that as technology/automation, globalization, and the global game of "musical jobs" continue to advance, governments around the world will have only one real tool to use against this massive problem; taxation. Taxes will go up, and eventually way up, as there will be fewer and fewer people working, paying for more and more who will not be. As we all know, but often forget, robots don't pay taxes.
Discussion #41 - Taxes

First introduced in the early 1900's, there is nothing inherently evil about taxes. If they are fairly implemented across the entire income/wealth spectrum, they can actually quickly pull a country out of extreme poverty. The problem is, this rarely (if ever) happens. Even in the richer countries, historically and currently the ultra-wealthy corporations and individuals rarely pay their fair share of taxes. The scope and magnitude of this situation is actually much larger than most people think. The super-rich in our world are in many cases paying virtually no taxes, and most of the world's assets and income are in the hands of these individuals and companies.

In fact, if the tax laws were tweaked to make them fair, many countries could pay off their entire government debts in less than ten years. Instead, virtually all of the tax burden has been and is squarely placed on the shoulders of the middle class. An economic group that is quickly shrinking in many areas of the world.

The main reasons why this legal form of corruption is occurring is due to the assistance of extremely clever accountants and lawyers, and the common form of blackmail that exists when a company threatens to relocate. They threaten to move elsewhere (taking their jobs with them), and we are politely informed that major tax breaks or incentives are/were required to keep them from leaving. Also, I'm pretty sure that most countries can afford some fairly clever lawyers and accountants themselves.

Most ultra-wealthy individuals or families are earning most of their income from investments, which are subject to capital gains tax and not income tax. Modifying this one tax law would itself make a massive difference. There are a few extremely wealthy people who recently have been begging their governments to tax them more. These are (in most cases) some extremely intelligent people, who know that all of this short-term greed is going to lead to some extremely long-term economic pain very soon.

When you add up all of the forms of tax that the vast majority pay, it amounts to a HUGE percentage of total gross income. On top of the income tax, there is sales tax, property tax, gasoline tax (typically half), sin taxes (alcohol & Tobacco), energy taxes, tariffs (customs & duties which are effectively a pre sales-tax tax), and can be upwards of 30%! The list goes on and on. When you consider that many countries did not even use most of these taxes until World War 2, it seems pretty extreme to most people. Knowledge is power, and creates political will. We musn't assume that we have no say or influence over what happens in the taxation department. Complacency is a very dangerous thing, and ignorance is never bliss.

Thanks to "The Panama Papers", we're taking a huge leap in microevolution as human beings in this area. We're starting to wake up and smell the coffee in how ridiculously naive and ignorant most of us are to the massive amount of financial corruption that has been going on, right under our noses, since the '70's. An incredible number of brilliant and upstanding financial professionals have been enabling, assisting, encouraging & profiting from this corrupt (yet most often legal) nonsense for a very long time. The only reason why the ultra-rich have been getting away with these aggressive tax avoidance schemes for so long, is because we've been letting them.

Added to this, is the harsh reality that as technology/automation, globalization, and the global game of "musical jobs" continue to advance, governments around the world will have only one real tool to use against this massive problem; taxation. Taxes will go up, and eventually way up, as there will be fewer and fewer people working, paying for more and more who will not be. As we all know, but often forget, robots don't pay taxes.