Fairness of Income Tax

Taxes
104

I just don’t think it’s a good principle to punish people for their hard work / success / or even luck. I believe in positive reinforcement, that is making it easier for people to achieve success, removing barriers that stand in way (for example complicated law that benefits huge corporations who can handle it due to economies of scale).

Also, I think more money should be left in the pockets of people like us, mustachians. We do not waste this money, we do not instantly spend extra income. We save and invest. So we effectively reallocate the workforce and capital from consumption/entertainment related activity to increasing future output (you put more money in a business that has a higher chance of growing).

So maybe in short term the low earners would see a reduced overall income, but thanks to technological advancement we would improve the living standard of all people in the long term.

105

I guess the ongoing pandemic is a good example of how inefficiently money is spent, even in shiny Switzerland

106

What about when you’re retired and most of your capital is in the house/appartment? You’re kind of forced to sell?!

108

This I agree with. And I see the point of Eigenmietwert. However I think home ownership is still encouraged. You can put your 2nd and 3rd pillar into home purchase, you can benefit from artificially lowered interest rate that encourages to take loans.

109

You fellas are fun.

I’m in favour of much less government reach, heavily more privatisations of public services and leaving it to folks to decide where they want to spend their cash.

Income tax should be abolished and a fraction of all moneys accumulated through gainful employment should be stamped as perishable along the principles of Silvio Gesell.

Just recently moved to Switzerland from Australia via Hong Kong and I find this country so heavily retarded on many levels that its purported “competitiveness” is a fact that I have yet to fully appreciate. Hopefully a bloke or two on that forum will help get there.

Tootle pip!

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110

Just in case you missed it: the most popular American politician in this forum is AOC :wink:

111

I mean there is a market of systems on the global level. For example this list of countries without income tax: https://nomadcapitalist.com/2018/11/22/countries-no-income-tax/

Of course they have their own drawbacks (and advantages). Some more, some less. Places like Switzerland still seem to deliver a competitive offer, despite existing taxation (and of course also because of it).

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112

That’s an interesting channel, I will check it out! For sure Switzerland offers one of the lowest tax rates in Europe, combined with the highest salaries. So it’s not bad! Just saying this in case someone says I should look for a different place to live. I’m also not proposing abolishing income tax here, but theoretically discussing the pros and cons.

113

Completing what @Bojack has already written, it started in a different thread, discussing the value of Income tax vs other alternatives. Following some discussion, my own intent was to illustrate that taxes are mostly spent efficiently and to evaluate what I personally get out of the local taxes I pay (which are the ones I know the best). At that point, most cans of worms were open and the thread went in several directions.

I think we mostly agree that taxes serve a purpose (though we probably all have different views on how the spending and amount necessary could be optimized) so the most prospective venue for discussions is probably to get back to Income tax vs other means for the government to finance itself.

I’m probably an exception but when I sign up for a job, I discuss gross annual salary with my prospective employer but evaluate what I want on a net, after-tax, basis, plus benefits (second pillar and potential specifics depending on the offer) so when I consider the gross salary I’m willing to work for, I’ve already considered income taxes as a deduction on it. In that regard, I don’t feel like taxes are punishing me for my work since I’m simply asking for a higher salary with them than I would if they were not collected on my salary (provided my needs wouldn’t change drastically due to another form of taxation to make up for it).

So, to me, income taxes or another kind of tax doesn’t make a lot of difference. Income allows to tax more people with more income but I’d be willing to trade it for either a tax on financial transactions (which would basically also target richer people, as well as financial institutions) or a tax system more aimed toward consumption (VAT and other taxes on specific products), with a range of rates sparing common consumption goods from the higher rates and luxury goods being taxed more.

That’s probably a topic for another thread but I’d be interested to know of your observations. Not saying I’d agree with it all (probably not) but fresh outside views are rare and always good to get.

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114

I’m interested in your views as well (as Wolverine), since I’m new here too; I’m still in Italy, and I’m trying to understand is the “CH package” is good enough for me or if it’s better to look elsewere fro my future as a doctor.

115

I’m wondering how much your objection is based on the income tax being unfair vs. being inefficient?

I think this distinction would maybe help the discussion.
If you’re concerned about fairness, this would become mainly a philosophical discussion.
If it’s about efficiency, this should be more about economic theory or empirical data. And there’s a vast literature on that question you might interest yourself in.

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