How to have a billion dollar exit with zero capital gains tax • Hacker News Board

Re: How to have a billion dollar exit with zero capital gains tax

#151

Post by ChrisLomont » Tue, May 10, 2022, 9:01 AM UTC

actually_a_dog wrote: post #140

yywwbbn wrote: post #136

Earlier quoted context omitted.

So US has around 9x less per capita since only ~5 million people live in Norway?

Since people are misreading this comment, either deliberately or because I have not been clear enough, I am going to assume good faith and edit the comment to be more clear. --- And 6.7x the amount of the Norwegian Government Pension Fund Global exceeds the entire annual budget of the US government. https://en.wikipedia.org/wiki/Government_Pension_Fund_of_Nor... https://datalab.usaspending.gov/americas-finance-guide/…

Comparing a pension fund, which is designed to pay out over, well, indefinitely, to an annual budget, makes no sense. One is a rate. One is a total. It's like saying you can fly 400 mph but the earth is only 90 mega-miles from the sun and since 90 is less than 400 the sun is not that far.

Numerology doesn't work in economics.

The fact is that Norway has this luxury solely through massive per capita oil wealth. The US cannot come close to this.

Re: How to have a billion dollar exit with zero capital gains tax

#152

Post by mschuster91 » Tue, May 10, 2022, 9:05 AM UTC

mcv wrote: post #138

mschuster91 wrote: post #123

Earlier quoted context omitted.

Intent matters. Opportunity Zones are set up to incentivize actual businesses providing services to the local community, not to serve as vehicles for far-away rich arseholes to cheat money out of the taxman.

But if the rules don't enforce that, and allow far-away rich arseholes to use these zones to cheat money out of the taxman, then that's sloppy legislating. The loopholes need to be closed. Relying on the goodwill of people whose primary unifying characteristic is the hoarding of extreme amounts of money is a bad idea.

The problem is a fundamental disadvantage in available manpower. Billionaires employ literal armies worth of extremely well paid lawyers, accountants and other professionals continuously working on finding and exploiting loopholes involving multiple jurisdictions, whereas most of the public services sector is barely keeping up. (Yes I'm aware that especially at the federal scale, the ultra rich sometimes outright buy special tax breaks, but that's not the case we're talking about)

The solution would be to allow punishing breaking the intent of a law, but given how politicized even the justice system is these days, I'm not so sure if that's a good idea either.

Re: How to have a billion dollar exit with zero capital gains tax

#153

Post by caslon » Tue, May 10, 2022, 9:05 AM UTC

dmje wrote: post #68

Unfashionable thought: pay your damn taxes. Loopholes are one thing and IMO should be closed but morality is another. The whole idea that you can make a billion dollar business without being hugely dependent on the infrastructure, education, history, societal background etc that has largely been paid for by...taxes...is utter fallacy. Maybe if massively profitable businesses spent a bit more time doing the right thin…

I generally agree with you, but I think your reasoning is partially nonsense.

I haven't benefit very much from government infrastructure. Woo, we have roads now. Where multiple of my family members have died, and most of my family members have been traumatized by those deaths. The person who raised me nearly died in one, and it left us even further in the poverty trap than we otherwise would have been, because of millions of dollars in hospital bills, even with insurance, thirty years ago, that we spent decades paying off. Oh, internet? I had dial-up growing up in the 2000s because my local government sucked and the wider governments sucked.

Honestly, my education sucked. It was actively harmful to my development. Government incentives historically kept my family in poverty, leaving my societal background awful, and filled with terrible people. And, on top of all of that, every two years, there's a 50% chance that a government I despise becomes in charge. Even when a government I find tolerable is in charge, more goes to funding wars than anything I genuinely care about. "Billionaires aren't paying fair taxes!" becomes a campaign point, rather than anything that could genuinely help people, because no politician is interested in fixing things.

The one thing that is unambiguously good about the US government, the Postal Service, has been getting slowly dismantled and made inefficient over the last decades.

Evading taxes is the only morally correct thing to do in America. I'm not going to evade them, because I'm not a moral person and prefer the convenience of not being randomly investigated by the IRS.

We should tax billionaires and companies because billionaires and companies suck. That's the valid reason. Cloaking it in false-utilitarianism is nonsense. Taxation should be punitive.

Re: How to have a billion dollar exit with zero capital gains tax

#154

Post by tnr23 » Tue, May 10, 2022, 9:06 AM UTC

tanto wrote: post #114

tnr23 wrote: post #75

Earlier quoted context omitted.

Norway oil is way more relevant for your thesis than Norway taxes

Yea right, so is the German oil for Germany. /s You seem to be quite the expert on Norway. Can you elaborate how they prop up social services with oil money?

Why do you feel offended?

OP had the thesis that the "Norway sovereign fund" is funded by high taxes. This fund is also known as the "Oil fund": The Government Pension Fund Global, also known as the Oil Fund, was established in 1990 to invest the surplus revenues of the Norwegian petroleum sector.

Conclusion: The Norwegian society is not just rich just because you are that smart. You obviously had a good portion of luck.

Re: How to have a billion dollar exit with zero capital gains tax

#155

Post by golergka » Tue, May 10, 2022, 9:07 AM UTC

orra wrote: post #144

golergka wrote: post #134

Earlier quoted context omitted.

> The whole idea that you can make a billion dollar business without being hugely dependent on the infrastructure, education, history, societal background etc that has largely been paid for by...taxes...is utter fallacy. Taxation is not a transaction you enter voluntarily; it's enforced by violence, and all these rationalizations don't matter as you don't have any choice anyway. So, taxation is either extortion, robb…

> Taxation [is] enforced by violence... taxation is either extortion, robbery or theft Perhaps, but less so than money. People wouldn't recognise other people as having millions or billions of wealth unless that was enforced through the violence of state capitalism, and a legal system protecting banks, creating cops and prisons. Why would they? Millionaires aren't a natural concept; it's something our society allows.

Justice (in any possible variety except “might is right”) isn't a natural concept too; it's something our society allows. You could also say that justice is a “social construct”.

So what? Does it mean that it's something not valuable or desirable? I don't think so.

Re: How to have a billion dollar exit with zero capital gains tax

#156

Post by golergka » Tue, May 10, 2022, 9:09 AM UTC

ABCLAW wrote: post #148

golergka wrote: post #134

Earlier quoted context omitted.

> The whole idea that you can make a billion dollar business without being hugely dependent on the infrastructure, education, history, societal background etc that has largely been paid for by...taxes...is utter fallacy. Taxation is not a transaction you enter voluntarily; it's enforced by violence, and all these rationalizations don't matter as you don't have any choice anyway. So, taxation is either extortion, robb…

>So, taxation is either extortion, robbery or theft If ultimate enforcement through violence is the only determinant of whether or not something is a crime, then the very laws that dissuade other crime, say the robbery or theft that you refer to, are themselves blackmail, extortion or some other variation of violent crime. This circular reasoning does not hold up to scrutiny, which is why it is almost only used in re…

> the very laws that dissuade other crime, say the robbery or theft that you refer to, are themselves blackmail, extortion or some other variation of violent crime

No, because in these cases it's violence enacted in self-defense (often by proxy), and therefore not an aggression.

Defending yourself is not aggression. Going after somebody or their property is.

Re: How to have a billion dollar exit with zero capital gains tax

#157

Post by TrackerFF » Tue, May 10, 2022, 9:09 AM UTC

golergka wrote: post #134

dmje wrote: post #68

Unfashionable thought: pay your damn taxes. Loopholes are one thing and IMO should be closed but morality is another. The whole idea that you can make a billion dollar business without being hugely dependent on the infrastructure, education, history, societal background etc that has largely been paid for by...taxes...is utter fallacy. Maybe if massively profitable businesses spent a bit more time doing the right thin…

> The whole idea that you can make a billion dollar business without being hugely dependent on the infrastructure, education, history, societal background etc that has largely been paid for by...taxes...is utter fallacy. Taxation is not a transaction you enter voluntarily; it's enforced by violence, and all these rationalizations don't matter as you don't have any choice anyway. So, taxation is either extortion, robb…

Just curious - you don't believe that people should be subjected to violence, but how would a state be able to enforce sovereignty over its territory, without the means of violence? Implied or otherwise.

I know the US defense complex gets a lot of sh!t for its massive expenditure, but the hard reality is that no state on earth is going to invade the US, and thus threaten its citizens within the boarder, which is a result of tax money being spent on building the most powerful military in the world.

Re: How to have a billion dollar exit with zero capital gains tax

#158

Post by orra » Tue, May 10, 2022, 9:13 AM UTC

golergka wrote: post #155

orra wrote: post #144

Earlier quoted context omitted.

> Taxation [is] enforced by violence... taxation is either extortion, robbery or theft Perhaps, but less so than money. People wouldn't recognise other people as having millions or billions of wealth unless that was enforced through the violence of state capitalism, and a legal system protecting banks, creating cops and prisons. Why would they? Millionaires aren't a natural concept; it's something our society allows.

Justice (in any possible variety except “might is right”) isn't a natural concept too; it's something our society allows. You could also say that justice is a “social construct”. So what? Does it mean that it's something not valuable or desirable? I don't think so.

The legal system is primarily a legal system, not a justice system.

Mainly, however, I am pointing out how absurdly reductionist it is for you to say “taxation is violence”. As you say, social constructs—taxation perhaps—can be “valuable or desirable”.

Re: How to have a billion dollar exit with zero capital gains tax

#159

Post by eptcyka » Tue, May 10, 2022, 9:13 AM UTC

TrackerFF wrote: post #111

dmje wrote: post #68

Unfashionable thought: pay your damn taxes. Loopholes are one thing and IMO should be closed but morality is another. The whole idea that you can make a billion dollar business without being hugely dependent on the infrastructure, education, history, societal background etc that has largely been paid for by...taxes...is utter fallacy. Maybe if massively profitable businesses spent a bit more time doing the right thin…

Honest to god, I'm kind of stunned by the people with tens to HUNDREDS of millions, liquid, that will go great lengths to avoid, even evade, taxes. You see people move to other countries for "tax purposes" alone. Or people that will create elaborate schemes. Of course, I understand that if you're in that wealth bracket, the actual tax/accounting acrobatics is abstracted from you. You probably hire some consultant to…

If you don't take tax at face value and see it as an optimization game, and only focus on what is to be gained (or what is to be lost), I can easily see why one might want to minimize their tax liability. To what lengths would you go to save 100'000$ a year? I don't earn that much, so I'd probably do a lot, as long as it's legal. I hate to advocate for the devil here, and I do believe everyone should be paying their fair share, but I don't think this issue is clear cut at all. Some ways to decrease one's tax liability exist due to government policies to encourage a particular behavior, sometimes it's to subsidize a behavior or a status quo. Tax isn't just a way to transfer wealth (but it often seems to be, and often is for the poorer part of countries), but it's also a way to shape behaviors. The unfortunate fact is that trying to incentivize or disincentivize certain behaviors for a large body of people will often introduce loopholes that can be exploited. However, some incentives end up being vital some livelihoods or behaviors that the country depends on. Not to say there aren't any cases where the loopholes are unambiguously bad.

Re: How to have a billion dollar exit with zero capital gains tax

#160

Post by hnbad » Tue, May 10, 2022, 9:21 AM UTC

TrackerFF wrote: post #111

dmje wrote: post #68

Unfashionable thought: pay your damn taxes. Loopholes are one thing and IMO should be closed but morality is another. The whole idea that you can make a billion dollar business without being hugely dependent on the infrastructure, education, history, societal background etc that has largely been paid for by...taxes...is utter fallacy. Maybe if massively profitable businesses spent a bit more time doing the right thin…

Honest to god, I'm kind of stunned by the people with tens to HUNDREDS of millions, liquid, that will go great lengths to avoid, even evade, taxes. You see people move to other countries for "tax purposes" alone. Or people that will create elaborate schemes. Of course, I understand that if you're in that wealth bracket, the actual tax/accounting acrobatics is abstracted from you. You probably hire some consultant to…

People don't become billionaires by paying their fair share and not screwing people over. I remember hearing jokes about how you need to be a sociopath to be a great business person, but the reality is that in order to maintain and grow massive wealth, you need to be willing to take advantage of others for personal gain and pay back literally the least you can get away with. Playing fair is for suckers.

Note that I'm not even talking about taxes. But tax avoidance also becomes a lot easier the more money you have.