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    Most of the tax codes around the world are meant to be ambiguous and convoluted, because they’re not so much really about revenue. They’re mostly about a) giving money to your friends, and b) a back-door into controlling the behaviour of business and citizens without that pesky barrier of updating the criminal code legislation.

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      a) giving money to your friends

      a.1) and big companies who profit from a complex tax code.

      The IRS and your state department of revenue prepare your taxes for you, every single year. The fastest way to see that is to make an honest mistake in calculating your taxes.

      This year, Turbotax bit me: I live and work in different states, but those states have a reciprocal agreement – any occupational tax I pay to the county where I work is a tax credit for the county where I live. However, it’s limited to the amount of county tax you pay. Of course, this level of complexity was too much for Turbotax and it decided to just mark every dollar I paid as a credit. I happen to live in a county with a very low tax rate and work in a county with a very high tax rate, so a 10^2 credit became a 10^3 credit.

      A week after I filed, the state department of revenue kindly sent me a letter saying my tax refund was being reduced due to an error. They showed all the work and pointed to the exact line item where Turbotax messed up.

      Amusingly enough, the same company that screwed up my taxes spends significant money maintaining the status quo.

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        So in the US your taxes are calculated twice? You pay for the first one but the second one is the truth?

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          In the US, the individual taxpayer is expected to prepare their own taxes (or use some software to file it, or pay an accountant to do it). What counts is what you file.

          But the tax agencies already know what your tax burden is: your employer sends them your tax information for the year, your bank/brokerage sends them statements on what’s taxable interest, etc. They know how much you made, how big your family is, and (most) credits you have. They have a tax figure computed for you.

          When you file, the tax agency essentially compares their number to yours. If they match, great. But if they don’t, and it’s because of an error you’ll get a letter like I did.

          The US government could send me a postcard with my tax already computed on it based on the data they have. I could report any credits they don’t know about: say I made energy-efficient home improvements, I could report them at that time and get a credit. Otherwise I would accept their calculation.

          Instead, lobbying efforts by Intuit, HR Block, and other big companies have pushed us in the other direction; bills were under consideration that would forbid the IRS from making any tax filing software available for free.

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            Most western countries are more or less the same, but you’re required to lodge something yourself, because that way if they decide to go after you the actual crime is signing off on the bad data. If it were automatic you couldn’t be prosecuted.

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          I was talking to my sister (CPA) about a tax formula, getting all huffed about it – then she put a pin in it by pointing out how the biggest problem with taxes is how many people don’t pay what they’re supposed to.

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            Everybody likes to point a finger at billionaires and their tax schemes, while imagining that “if only Bezos paid his fair share my taxes would go down or I’d get more free shit” but that’s not really the case. For Joe and Jane Sixpack, the reason they pay as much as they do is solely so the government can incentivise them to do certain things by giving those things tax breaks. It’s about control first, inflation second, and revenue last, if at all..

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              For Joe and Jane Sixpack, the reason they pay as much as they do is solely so the government can incentivise them to do certain things by giving those things tax breaks.

              Fair – though my main complaint(s) with billionaires not paying as much as they should is that (a) it’s simply not fair, and by not being fair it leads to decreased trust in the mechanisms of government, and (b) if billionaires did pay their fair share, the government would have more revenue to better-fund education, healthcare, safety, etc. Of course, there’s another conversation to be had about the tendency of at least the American government to fund the military instead – but that’s a whole other issue.

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          In economics this project would be called a “tax incidence study”.

          Not exactly the same, but there’s a long history in the field of “computational law” or codifying laws in formal logical languages like Prolog. Then finding bugs and contradictions in the law automatically.

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            I didn’t expect such system already exists and is used to design actual legislation.

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              France is one of the biggest funders of formal methods research!

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                Allons enfants de Bourbaki, Le jour de gloire est vérifié

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              This is pretty rad. And, it would be pretty nice if all law could be expressed this way. Probably can’t and shouldn’t be for various reasons, but it would be nice.

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                Formal methods don’t need to obviate judges. They can be used to discover contradictions, and to indicate to judges where their judgement is needed.

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                I have been wondering about a similar subject for the past half year or so. If you could model the system using existing tax laws, interactions between different taxable entities, ownership of entities and their property, the depreciation of such, many many other variables that I probably don’t know about yet and the interaction of different separately governmentally conceived systems, you could probably figure out a way for a group of people to pool their money into a vehicle to avoid paying any amount of taxes whatsoever, but in a possibly altruistic fashion.

                Taxes ideally are for the greater good but it seems like that’s not happening so my feeling that if everyone can get out of paying them then nobody will get out of paying them sooner rather than later. /soapbox