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Washington State Debates Taxing Software Creation
zzyzx writes: "An article in the Seattle PI discusses the existing tax on software creation in Seattle. The law was clarified recently to allow the taxing of the software that was created in Seattle, even if the manufacture of the discs occurred elsewhere. Some Washington state lawmakers are working to overturn these changes. The issue at the heart of the matter:
Should an intellectual activity such as programming be taxed in the same way as manufacturing is?"
To the morons here in
To the morons in Seattle who thought this was a good idea: That sucking sound you hear is hundreds of high-tech businesses leaving your city.
If all this should have a reason, we would be the last to know.
You obviously don't understand Washington's B&O taxes. It's a tax on income (not profit). If you're writing open source and not charging for it, there's no income to tax.
If all this should have a reason, we would be the last to know.
Politicians here, at every level, are trying anything they can think of to maintain their revenue streams.
Government at all levels here in Washington is under a tremendous pressure to reduce taxation thanks to several populist initiatives written by Tim (I'm a liar) Eyman, and passed for the most part very succesfully by the voters each time one has come up for a vote.
The State legislature has just passed a $0.09 per gallon gas tax increase, and they are down in Olympia squabbling at this very moment about whether they dare let the voters have the final say-so on the tax increase by voting for it in a referendum some time this spring.
Most of the career politicians don't have the backbone to let the public vote, because they know people will vote it down.
So it's not surprising Seattle is going to tax thinking.
They tax just about everything else...
t_t_b
I'm on PJ's "enemies" list! Are you?
First of all, you forgot one kind of taxation, excise taxes, ie taxes on specific things that the government doesn't like. (Alcohol, tobacco, pollution, gambling etc) These sound like a good idea, and they are, to a point. The practice of having a market of pollution quotas is well proven to work. The problem is that when these taxes get too high, and if there's a way around these taxes, that will become a problem. For example, sweden has very high taxes on hard liqour -> A lot of moonshine in circulation -> people die from drinking methanol every now and then. (And a lot of people end up in jail for running the illegal alcohol factories.)
(Oh yeah, and estate tax. It seems like a good idea ("It they're going to take my money, the best time for it when I'm dead!"), but it too can become a problem for example when children inherit a house that's worth a lot and have to sell it immediatly to pay for the taxes on the estate.)
Property taxes get problematic as they grow high, as around here a lot of (for example) old folks who own their own house have to move because they can't pay the taxes on it anymore with their pensions, because the area got more popular and the house increased in value because of that.
A too high sales tax (we have 25% except for books(6%) and food(12%)) creates a large shadow economy with bartering and/or their own currencies which is never good. Actually, in sweden, if you're a painter and your neighbor is a carpenter, and he builds oyu a shed and in return you paint his house, you're supposed to report that to the government so they can tax you. This is rarely done. :)
Income taxes. You're right about these. I pay about 51% in income tax and I'm certainly not rich. The problem here is largely the sama as with the high sales tax, it becomes very profitable to try to avoid it by "swapping favors" or getting paid in goods you make and stuff like that.
Too high tariffs and duties make your nation's industries weak. Just you watch your steel indutry the coming years... :)
Use fees. If it can be financed that way, the government should butt out and let industry deal with it.
In short, TANSTAAFL, and there's no such thing as a good tax. The least bad one I think are excise taxes on pollution, because it's reasonably moral, reasonably enforceable, and has the potential to bring in quite a lot of money, done right.
"An object declared as type _Bool is large enough to store the values 0 and 1." -- 6.1.2.5, C99 standard.
Good article, but you missed a couple of other options (and I disagree with your ideology, but it's still a good summary).
The first one is profits from State-owned companies. The Australian telephone monopoly is partly State-owned, and provides a fair amount of revenue for the Oz government. Of course, like every other shareholder, the government must accept that sometimes companies lose money.
The second one is profits from justice - traffic tickets are an obvious example. Note that RICO-type property siezures make it tempting to ahhh put a finger on the scales of justice.
The third one is death duties, inheritance taxes and the like, although I guess they are a specialised sort of sales tax.