Wellspring taxation: Apologia

Basics

Valid forms of taxation:

We've chosen to directly tax only natures owners because we would like to limit the amount of interaction between the government's tax collectors and the average citizen.

In case it's not obvious: the prohibition on taxes on wealth also applies to inheritances.

Upper limit on taxation:

The number, 10%, can obviously be changed by constitutional amendment, obviously - and only by that means.

Incentives via tax discounts:

In order to claim the tax discounts here discussed, companies should have as close as possible to a single, unambiguous purpose. It is perfectly fine for businesses to spin out sub-companies which specialize in one or more of these tax discounted areas. If a business' purpose is ambiguous, it will be taxed againt the highest of its tax classifications so as to preclude companies from merely claiming the tax discounts for auxiliary functions.

These tax incentives are meant to give preferential status and allocation by natures lords, to certain species of enterprise in order to ensure their relative abundance and thereby overtune their supply so as to err on the side of caution. These preferred industries (they are not preferred in moral terms but in expediency terms as well as for polemics) will have a greater chance to sustain profitability due to their preferential tax status.

Recall that of the 3 general categories of income (rent, wages and profit), rent is charged based on what the payer can bear to pay:

In adjusting the terms of the lease, the landlord endeavours to leave him no greater share of the produce than what is sufficient to keep up the stock from which he furnishes the seed, pays the labour, and purchases and maintains the cattle and other instruments of husbandry, together with the ordinary profits of farming stock in the neighbourhood. This is evidently the smallest share with which the tenant can content himself, without being a loser, and the landlord seldom means to leave him any more. Whatever part of the produce, or, what is the same thing, whatever part of its price, is over and above this share, he naturally endeavours to reserve to himself as the rent of his land, which is evidently the highest the tenant can afford to pay in the actual circumstances of the land. Sometimes, indeed, the liberality, more frequently the ignorance, of the landlord, makes him accept of somewhat less than this portion; and sometimes, too, though more rarely, the ignorance of the tenant makes him undertake to pay somewhat more, or to content himself with somewhat less, than the ordinary profits of farming stock in the neighbourhood. This portion, however, may still be considered as the natural rent of land, or the rent at which it is naturally meant that land should, for the most part, be let.

Rent, it is to be observed, therefore, enters into the composition of the price of commodities in a different way from wages and profit. High or low wages and profit are the causes of high or low price; high or low rent is the effect of it. It is because high or low wages and profit must be paid, in order to bring a particular commodity to market, that its price is high or low. But it is because its price is high or low, a great deal more, or very little more, or no more, than what is sufficient to pay those wages and profit, that it affords a high rent, or a low rent, or no rent at all.

Adam Smith, An Inquiry into the Nature and Causes of the Wealth of Nations

Natures lords will seek out those uses of their natures which will yield them the highest profit. Given that the government's taxation makes the government the first-order lord of all within the polity, the natures lord is left to charge rents from what is left over after the government charges its taxes. Where the government charges lower taxes, more income is available to be claimed by the natures lord. In this manner, these categories of enterprise should enjoy some preferential treatment.

Naturally as well, the good negotiators among the business owners in these industries should be able to meet in the middle and claim some of the additional profit themselves.

Heavy tax discount on certain insurers:
Private security firms and investigators: We want to ensure that where the government's police service is not meeting the security needs of population segments, those segmnets can meet their needs through private means. In particular, where government investigative services are not acting as a sufficient deterrent from crime, private investigators are not too expensive to purchase.
Legal aid: It should not be difficult for indepagents to avail themselves of the courts. Ideally, it should be a smooth process.
Pension funds and healthcare insurance: There should be an abundance of options for pensions and healthcare insurance so as to give indepagents little excuse for not contributing to pension funds and health insurance programs to care for their future.
Bank depositor insurance: This should ensure that the private sector provides sufficient insurance against bank runs, so as to keep the banking system stable, and ensure that big banks can be left to go bankrupt when they are irresponsible. Let the depositors be insured, and let the bank fall.
Medium tax discount on addictive substance assistance and waste management services:
In a polity where addictive substances are not illegal, we should incentivize an abundant supply of professionals and services for assisting the addicted with their addiction and moreover, with the circumstances that pushed them into addiction.
To ensure that it is cheap for Homeowner Associations, gated communities, individuals and families and so on to pay for waste management services, we incentivize their abundance. In addition, we incentivize sorting and resale services which re-sell materials to factories/industries for re-use and vertical re-integration.
Light tax discount on schooling and education:
In a knowledge based economy, there should be an abundance of options for education, retraining and continual learning.
Negligible tax discount on non-profit corporations:
We aren't yet sure whether or not we should keep this one.

No deceptive illusions

This section is pretty self-explanatory.

6.2 KiB Raw Blame History