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Comment by cm2187 | Hacker News Reader

11. When your donation is taken by force through taxes

There will always be force in the equation. Do you think that your payments to the armed bands that would replace government would be lower?

Not sure why you're being downvoted, you actually do have a good point... I guess people are uncomfortable with directly acknowledging that social programs are funded by "donations" that are taken by force (i.e. taxes).

They're not "donations".

They're taxes, period. There's no moral benefit to paying them in the same way there's no moral benefit to obeying traffic laws. It's not a charity as it's not voluntary. It's the cost of playing the game.

I would argue there is a moral obligation to obeying traffic laws.

Historically, most societies considered maintaining social order as a moral obligation. Guest Rights and Obligations etc seem to disappear as society and governments became more effective. That’s somehow translated into the idea that not paying taxes is somehow perfectly ok. https://en.wikipedia.org/wiki/Hospitium

"Every tax, however, is to the person who pays it a badge, not of slavery, but of liberty. It denotes that he is subject to government, indeed, but that, as he has some property, he cannot himself be the property of a master."

Adam Smith, Wealth of Nations.

It comes from the same pocket. The scale of charitable donations is usually inversely proportional to tax rates and redistribution in a country. When people are highly taxed in high redistribution countries, they feel less compelled to give directly since the state is doing it for them (in addition to having less disposable income).

Maybe there is also less need/causes to donate to if living in a high redistribution country (and yes proximity is important for a lot of people at least emotionally).

You should check out France to find out if high redistribution eliminates poverty (hint: it doesn’t).

But it does a very swell job at eliminating most of the worst of abject misery that comes with poverty in most other places.

Being poor in Latin America is an exponentially worse experience than being poor in France.

So wont private donations. I believe some forms of poverty are unavoidable if you want to have a free society (i am not saying I endorse either side). The country I live in has the rule you are not allowed to treat mentally ill people against their will (if they are considered harmless). There seems to be some evidence that quite a number end up homeless. So what can you do? Not realising being sick is one of the symptoms of some of these (treatable) diseases.

Adding more money wont solve anything.

It’s the cost for some. If you’re rich enough you pay far less tax because you have access to an army of people whose job it is to help you do that. They leave us suckers to pay.

That’s not right. I think more of people who pay their fair share. Feels like a moral issue for me.

>>They leave us suckers to pay.

Except that's not true at all. Vast majority of taxes come from the richest. They might pay less percentage wise than me and you, but they pay the most in absolute terms.

>>I think more of people who pay their fair share.

I think more of people who pay more tax, not of those who pay more percentage wise. Ie - someone who makes a million dollars and pays 100k in tax seems to be contributing far more to the system than someone who makes 20k and pays 4k in taxes - even though the second person paid more percentage wise. Which one of these is "a fair share"? Why is one person literally paying 25x as much in taxes? Do they use the roads and hospitals and prisons and the police 25x as much?

I mean, I can see both sides of this argument - but I do dislike when people just go "oh us suckers down here are paying all the taxes" - like, no, we just don't.

>Do they use the roads and hospitals and prisons and the police 25x as much?

By use do you mean "physically interact with" or "reap the social benefits of?" Because for one of those it's a clear yes.

> They might pay less percentage wise than me and you

Isn't income tax higher for those that earn more?

Usually, yes, if you are paid like a normal employee. I'm jumping straight to the point that many people have an issue with - that once you're wealthy enough, you don't make most of your money through a salary, you make it through capital gains, dividends, and other financial tools that make your effective tax rate much lower than it would have been had you taken it as a salary.

In a huge oversimplification, let's say you're in UK and make £100k/year. If you take that as salary, you'll pay 20% tax on around £40k of it, then 40% tax on £50k, with the remaining £10k being tax free. On the other hand, if you open a limited company that makes £100k, well, you're only paying 10% corporation tax on any profits - but of course the way to play this game is to expense everything imaginable under the sun, so ideally you have close to zero profit at the end of the tax year. Yes, the money isn't "yours", it belongs to the company, but you can expense things like your rent, gas, electricity, "work meals" etc. Then take £10k salary from your own company which is within the tax-free allowance. Voila, in the eyes of someone external, you've made £100k but through "clever tricks" paid less than 10% tax on all of it. Of course most people don't realize that isn't not that simple, but things like this lead to very quick judgement.

That’s far from accurate. Income taxes contribute ~$1.932 trillion, but payroll taxes add $1.373 trillion and are often ignored in these calculations. As social security is capped at relatively low income levels the tax burden on the rich is much lower than often suggested.

Further, the often quoted top 1% is hardly the rich in the US, if you compare the income vs taxes paid of the top 0.01% their paying a lower percentage of their income than the average programmer in federal taxes. State taxes have a similar breakdown with property taxes, fuel taxes, etc representing a vastly lower burden for the 0.01% of income earners.

This is further compounded when you consider tax free wealth accumulation of capital gains where taxing in sale mean zero tax on possibly decades of income, or possibly ever. You don’t deduct charitable donations from social security taxes.

PS: As to what the rich receive in taxes. They receive a functioning society which is economically worth far more to themselves than lower income earners.

CBO did an analysis of household income, all federal taxes paid, and transfers and services. On a net basis, the top 40% pay for everything at all levels of government. The bottom 40% pay for only a portion of what it takes to keep themselves alive. The middle 20% splits between the two groups, but the portion that are net payers, pay very little.

> They receive a functioning society which is economically worth far more to themselves than lower income earners.

This is not obvious. Historically, the lower classes have very little rights and are subjected to oppressive behaviors from the kings and nobles and other well to do.

That’s amazingly misleading, people receiving Social Security and Medicare benefits tend to have lower earnings than they did while working full time. Effectively, averaging people who pay lots of taxes and receive minimal benefits with others who are receiving massive benefits gives a very distorted view of what’s going on.

Similarly, lumping everyone in the top 40% with the Rich completely hides how little the rich pay by lumping them in with the highest effective tax rate groups.

PS: It gets even crazier than that when you consider Trump for example qualified as having zero income for multiple years.

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