Friday, 3 March 2017

Shit (not to mention pointless and unworkable) ideas of the week

From The Evening Standard:

The influential Institute For Public Policy Research said Mr Khan and other mayors should be put in charge of chairing health and care management bodies and be given tax-raising powers, as in New York, that could include “sin taxes” on sugar, fats and cigarettes.

Ahem, won't Londoners just do "booze cruises" out to the Home Counties?

From the BBC:

Stamp duty should be a tax on property sellers, rather than buyers, to help those trying to buy their first home, a major UK building society has said.

As OnTheOtherHand said when emailed me the link...

... imagine the simultaneous conversation that couples A, B, and C all bidding for the same house in London have after the law is changed:

"Now that the seller is paying £13,171 stamp duty, let's take that money we deposited with the conveyancing solicitor to pay the duty on our behalf, and bid £13,171 more for the property to beat the other couples..."

From The Guardian:

So when Bill Gates pitched into the debate last week with a proposal that robots should be taxed, just like human workers are, you can imagine the splutters of outrage from the neoliberal fortresses of Silicon Valley.*

“Right now,” he said, “the human worker who does, say, $50,000 worth of work in a factory, that income is taxed and you get income tax, social security tax, all those things. If a robot comes in to do the same thing, you’d think that we’d tax the robot at a similar level.”

And the money raised should be used to retrain people the robots have replaced, with “communities where this has a particularly big impact” first in line for support. I never thought I’d write this, but here goes: good for you, Mr Gates.

* Wanker. People working for the "neo-liberal fortresses in Silicon Valley" are already paying a super-tax i.e. the very high rents they have to pay to be able to live within commuting distance of a well-paying job.

To be fair, the rest of that article was a bit more nuanced that the knee-jerk Luddite "tax robots" meme that has been doing the rounds recently and which I intended to take the piss out of.

Gates actually said "you'd think we'd tax the robot at a similar level [to the worker]", which is nothing more than saying that corporate profits (from the automation) and wages (from not automating) should be taxed at the same level, rather than taxing wages at double the rate of corporate profits, which is of course a good idea for many other reasons.

No idea what the "retraining" nonsense is all about, pay people welfare while they're unemployed and pray that new businesses grow and develop and take them on is all you can do.


mombers said...

I took someone's job the other day. We ordered take out but instead of paying someone to cook the rice for us, we cooked our own. VAT free and no tax on my labour. Should we have paid a compensatory tax? The argument is completely the wrong way round. We simply should not be taxing labour - it is plentiful and any attempts to tax it will obviously end up with automation / offshoring / fake self employment / etc

Mike W said...

Mr Khan does not seem to consider that one does not introduce 'sin tax','bad taxes, 'bads' for tax raising pupose as such. Government brings them in to change our behaviour for the puported 'good'.So, if they actually work, would not revenue, reduce overtime? And Mr Khan will be casting around to fill the hole he has made in his own budget? I cannot believe this was not pointed out to him.

As it happens, a friend of mine, who works on the science side of a large sugar company you all know, is gearing up their counter argument on the sugar tax.(Pointing out the above problem with bads/sin tax is not part of his brief I should add)

Their argument against the ST: unworkable,lose industry (jobs) here, the problem of 'natural sugars' in everything and finally, why this industry specifically(given there are a lot of other factors between basic sugar products and an overweight person)?

Anicdote: From what he says: if this firm leaves London, then Khan would have a real problem to solve. So I think we can conclude here, another reason why it is all fake.

Steven_L said...

If they wanted to tax 'robots' wouldn't they just tax electricity?

Bayard said...

Mike W, it's just to keep the Puritans happy. After all, look what happened here in the C17th when the government failed in that basic duty.

Paul Lockett said...

Those of us who understand tax incidence know if make no difference whether the buyer or the seller pay stamp duty. However, when it comes to tax compliance, it's a different matter; the buyer has a strong incentive to pay the tax - if they don't, they don't get their name on the land register. Make the seller responsible for paying and you have a higher likelihood of non-payment.

Mark Wadsworth said...

M and SL, exactly.

MW, another reason why this won't happen. We can't pin it on Khan (who has enough shit ideas of his own), this idea is from IPPR.

PL, yes, but the buyer would make it a condition that he does not complete until the land registry confirm the SDLT has been paid (or something).

DBC Reed said...

Of course ,after WWI, Major Douglas galvanised political opinion with his version of Basic Income (National Dividends)which were designed to pay people an unearned income to be able to afford the products of robot production.Apart from "1984" which was Orwell's idea of the end result of not intro'ing National Dividends,Douglas's idea has completely disappeared from sight.Not surprising: I was trying to think of a tenured academic Economist with any interest in LVT now that Roger Sandilands (Strathclyde) has retired, assuming that's what Emeritus status means in fact.

Mark Wadsworth said...

DBC, the basic income idea is widely discussed and s being trialled in some countries.

Shiney said...

Taxing 'robots' is a shit idea.... obviously.

I own a business, we employ people and 'tools' (machines, robots even). How do you distinguish between machines that have HMIs, circuit boards, servos, sensors, auto stops etc and 'robots'. Is a self driving pallet truck a 'robot'? Is an unattended filler/stacker a robot? FFS we'd just be giving jobs to the lawyers and accountants (of which I'm one).

Agree with Lola (from another thread) - capital equipment makes workers richer by making them more productive - and MW ... equalise the taxation of profits and wages, by reducing the taxes on wages preferably, and you're done.

Mark Wadsworth said...

Sh, how do you distinguish? Clearly it's nonsense as you say.

And yes, I'd rather level down taxes on wages by getting rid of NIC than increasing corporation tax to 40%, but that's details. I am a flat taxer but the flatness is more important than the actual rate.

Bayard said...

DBCR, it's so long since I read 1984, I can't remember, but do the citizens of Airstrip One enjoy a basic income?

Mike W said...

DBC Reed, Brilliant contribution. I have some questions about Major Douglas, who I have been looking at, though at a snails pace, since the last two, or three, or four times, you have posted on him here:) Drawing the link with Orwell has stopped me in my tracks -WOW - I need to rethink that before I post anything. Obviously as a youngster considered myself an English: Orwellian, Socialist.Moving towards Meritocratic, Georgism has not been hard. so I still have no friends on the left!

Shiney, I am still chuckling over the gag about lefties having a preference for heavy things they can drop on their toes rather than our service economy (I hope it was your joke!) Agree with your points. I have wholely adopted Lola's idea of, 'not low wage but high rent economy' too. I am sometimes not sure if i said it first myself ;).

The Sec at Labour Land Campaign emailed me a wonderful letter sent to the FT from Georgist who thought that the Robot tax was foolish. If you have read Henry George, the writer said, well then you know we tax the land the machines are sitting on, and distribute the rent as Citizens Income.Has anybody else seen?

Bayard,I think we need to dust 1984 down? As I recall, the three superpowers are always at 'war': Fake of course. There is no danger of a clear winner even with nukes.But the population is always on rationing. Orwell is alluding to this when he discribes the smell of cabbage and the war time BBC together,appearing as the smell of Winston's ministry.

DBC Reed said...

Airstrip One, always at war to destroy the products of production which they can't afford to buy, is the antithesis of Social Credit.
@MW The difference with the Douglas scheme of Social Credit is that it recognises that credit is money and that money is therefore extensible through credit creation and can "cover" or back the production of goods by robots. Later schemes of Citizens Income tend to be redistributions of the Tax take by people who insist ,manically, that there is no such thing as the Magic Money Tree and such-like bank propaganda (see Peter Spence "There is a Magic Money tree and five other facts about money" Daily Telegraph 30.ix 13)

Shiney said...

@MikeW - yeah I think that was me although I nicked it from somebody else... can't remember who. And I actually do make 'stuff' (well the company I own does). You can drop it on your foot but it wouldn't hurt much ;-D.

To repeat (probably) and off topic (slightly). I've always failed to see how jobs in 'manufacturing' are somehow seen as better than other forms of work. Can anyone enlighten? And anyway, once the robots are doing all the actual making, people working in manufacturing will be mainly white collar admin types or techies rather than 'horny handed sons of oil' so beloved of lefties who've never been near a shovel in their life. In my experience anybody on 'the tools' can't wait to be promoted into an admin or techie role anyway.

@MarkW - flat taxes... always was a good idea. Stops tax arbitrage and anything that puts shyster lawyers and accountants (present company excepted) out of business is 'a good thing' IMHO.

Oh, and nobody should listen to Gates. He's a twat. Remember he's the man who gave us Microsoft Windows.

Shiney said...

Ooops ***'horny handed sons of toil' ***

Son's of oil don't work... they just become POTUS.

Mark Wadsworth said...

S, most tax advisors (like me) would be out of work if the Chancellor of the Exchequer took my advice. That said, I'd still be better at it than most people so maybe I would be one of the few that are left?

Lola said...

Shiney. What is a manufacturing job? DHL supply chain (service?) keep just-in-time manufacturing going and makes it more efficient. Is DHL a service or a manufacture?

Nineteen Eighty-Four is a dystopian vision of the inevitable end game of socialism. Its perpetual state of war presages the warfare welfare state that now visits its failures on us.

MW. Yes. You and Me (to a lesser degree) both. Hooray!

Shiney said...


Exactly... years ago most manufacturing companies employed lots of support people (e.g. cleaners, lab staff, payroll, haulage etc) - now a lot of that is outsourced. So 'manufacturing' employment has fallen. And who cares anyway? Wealth creation is what matters.

Mike W said...

Lola above:'Nineteen Eighty-Four is a dystopian vision of the inevitable end game of socialism.'
I have no problem with this, if and only if, you use the terms Marxism/Communism.I wholely agree with your argument that Georgism is the only solution (political economy) left standing in a world of 'croney capitalism and crony socialism' too. But you cannot have it both ways. Orwell was a towering figure, an English socialist until the painful end, and a go to thinker for a generation in the league, of H G Wells, not some half arse, like Will Self.
Orwell was writing against the future dangers of our society and his target was 'Totalitarianism'. That is, 'Croney Capitalism' turned Facscist and 'Croney Socalism' turned Stalinist.He knew what he was writing. Part of his work that fed into 1984 was an essay called Politics and the English language. He was concerned about the Totalitarian hand shaping our language and thus, our thinking. Should you have got up to Jura to meet him before the end this is what he may well said.The problem with the American Empire, and its faux interest in markets, as deployed by users of Von Hayek, is that it will so abuse and treat with contempt our abilty to discusss ideas:that I will, for example, be seen in America as an enemy of socialism (merely another Libertarian), and the Burkian Tory, Keynes, will be seen as a socialist.This is the Totalitarianism I fear.

In short, Orwell was even more concerned in the reduction of complex ideas,language and history to slogans than the perpetual war in the background of 1984. War is Peace, Freedom is Slavery, Ignorance is Strength .... and Socialism is not-freedom for Hayek, so we will all work from that premise only.

Bayard said...

Re taxing robots: A human worker will get ill and need the NHS, has to be protected by the police and army, has to travel over roads provided by the state, will one day want to retire and draw a state pension etc etc. Robots need none of these and, what's more, can work in the dark and the cold. Taxing robots is just more Politics of Envy.