Comment by zbentley

Comment by zbentley 4 days ago

> Now the government wants to tax them on the company value?

I’m genuinely baffled at the incredulous tone here. Yes, that is exactly what should happen: laws, subsidies, and incentives enable a company to grow and flourish. Then, as the company grows, other laws incentivize it to give some of its state-sponsored affluence back to benefit the country.

Like, sure, the execution of that process is often dysfunctional, but the fundamental contract there does not seem like it should be surprising to people: we don’t have (many) socialist state-owned businesses, but the point of a functioning country is still to provide good things to the people living in it. Not to benefit businesses or a tiny sliver of the population.

That’s why we have everything from income taxes to interstate highways: to distribute wealth and resources to (a flawed approximation of, but it’s still the goal) everyone in the country. That’s just how non-corrupt governments are supposed to work!

carlosjobim 4 days ago

> give some of its state-sponsored affluence back

Then why not tax the military? They are surely the most affluent company of them all, if you take a tally of all their inventory.

If you tax companies based on their size rather than their profits, then you're not going to have any big companies. Any investor or entrepreneur would be a fool to invest in making a big company.

But many endeavours need big companies and big investments. For example power plants. That's a whole lot of value to tax, such affluence! Better redistribute this wealth, and instead have a hundred thousand non-affluent hot dog stands.

> That’s just how non-corrupt governments are supposed to work!

In practice, every government in the world does not tax companies reinvesting their profit into growth.

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zbentley 4 days ago

> why not tax the military?
Narrowly: because they're a utility funded by taxes, not an independent entity benefiting from tax-funded infrastructure. Having a military for defense/power projection/whatnot is one of the infrastructural benefits of being part of a state (and one of the things that a company that grows in that state "owes" the state tax money for--whether that's owed on growth or just capital).
Like, do I personally think my country's military should have a vastly different funding profile, incentives, and behavior? Absolutely. But that doesn't change the fundamental dynamic: $state provides $thing (security, clean water, cheap gas, whatever) that makes being in $state good for many people, people who do well financially within $state owe it money back on the basis that their doing well is at least partially a result of $thing being available to them.
> Any investor or entrepreneur would be a fool to invest in making a big company.
Not true. A growth tax need not be a 100% tax, so growth would still be an advantageous thing to do. Many countries have tax brackets today; that doesn't discourage people from getting rich.

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- carlosjobim a day ago
  
  What I'm saying is that the high value of a large company is not "affluence".
  An ugly military troop transport might have the same cost / value as a desirable sports car. Not to mention other types of military equipment. But we wouldn't think about that as affluence. Because we know that military equipment are tools with a purpose.
  The same for the value which is locked in within any giant corporation. Of course a large industry is going to have expensive equipment and lots of other investments, which nobody thinks of as "affluence". That is exactly what the money of billionaires is. They own a share of all that ugly equipment, which has no use outside of a big company.
  
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