Re: AltInst: Tax Inferred Ability to Pay

It has long been known in economic circles that a tax which does
not have any effect upon incentives to trade is to tax "diamond
goods"; i.e., good whose only value is that they are scarce and
desirable, but have no other use. In pre-industrial times, gold
would have worked well, but now taxing it would negatively impact
industrial uses of gold (like electronics).

There do still exist semi-diamond goods: trademarks, for example.
Or other namespaces such as the internet domain name space. A
government could be financed by having it control the domain name
system, and having it auction off desirable names, whose value
comes from scarcity of consumer attention. Trademark registration
in general could be auctioned rather than being given away to the
first claimant as happens now. Continuing revenue can come from
the government taxing third-party sales of tradmarks, domains, or
whatever other namespaces it needed to appropriate for its use.

Note that trademarks are still not "perfect" diamond goods, as
the commodity of consumer attention is more valuable to some
industries (e.g. publishing) than others (e.g. mining), but it
would have little effect on different types of economic activity
compared to current taxes, and one might argue that taxing the
most blatantly obvious facets of consumerism is a feature.

--
Lee Daniel Crocker <lee@piclab.com> <http://www.piclab.com/lcrocker.html>
"All inventions or works of authorship original to me, herein and past,
are placed irrevocably in the public domain, and may be used or modified
for any purpose, without permission, attribution, or notification."--LDC
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