Dec 12, 17 / Cap 10, 01 23:11 UTC
Future Tax Code ¶
Obviously this is something that the parliament will need to discuss and decide on once formed, but we should start the conversation now. I am not talking about taxes applied before the first station is built and colonized, but it isn't a discussion that can wait until that happens either. Investors and business partners are going to want to know how taxes will impact their investments before signing on, so we need to have an answer to that question before seriously courting potential investors. For instance if someone pays a large sum to contribute to the construction of the station in exchange for space on that station to either rent out or to build a hotel, they are going to need to know how much of their profit they will get to keep in order to decide if they will recoup their investment and make enough to offset the risk.
To kick off the topic I would suggest that taxes be on profit (income after expenses are subtracted out) and that the purchase of space in a newly developed structure that contributes to the construction of that facility (be it an orbital structure or a facility built on cosmic body) can be taken as a future expense appied after all other expenses as far out as 30 years from the colonization of that facility, but this facility construction expense cannot exceed half of dividends paid.
In other words they can potentially cut their taxes in half until they have claimed their entire investment as an expense over various years as an incentive to invest in the actual constrtuction of the facility.
I suggested in another thread somewhere that automation also be taxed and the use of those funds be put toward a universal basic income so that as automation replaces jobs we are not leaving people without a way to support themselves. That tax, however, should be small enough that automation is still a better option financially (as automation that doesn't leave people in poverty is very good for an economy). For this I would suggest a tax of 50% of the wages that would have been paid for a human to produce the same work, minus the cost of the equipment divided over the expected life of the equipment and minus any repair costs. In theory this would make it beneficial for the owner to automate as they would be cutting the cost of production in half, which would increase overall production of the society (as those workers would most likely go to other productive jobs), and would still ensure that increased automation doesn't hurt the individual members of society.
Next, I would suggest that companies are not directly taxed. When they issue profits to shareholders, the shareholders add it to their taxable income. Tax reductions such as the facility construction expense would be claimed against dividends paid, so if they paid out a total of 100k to a total of 100 shares and they claimed 50k as a facility construction expense, than the shareholders would be taxed add 500 to their income numbers when determining their taxes.
Any income going to a company outside Asgardia would figure their expenses and pay taxes on the amount that leaves Asgardia's economy as though it were income. Likewise any individual outside of Asgardia with business in Asgardia would pay taxes on all income they receive from their investments. To be fair amd not take from both ends (and to encourage bringing resources I to the economy, investments outside of Asgardia which Agardians profit from will not be taxed by Asgardia (but Asgardians would still be expected to pay any taxes that a are levied by the nation the investment is in). If investments are not within any nation (such as mining an asteroid or providing a service outside the scope of any nationn) and the individual profiting from them is an Asgardian citizen not residing in the territory of another nation, than they would pay that as income taxable in Asgardia.
Finally I would suggest an incremental tax rate based on income, so those who make more pay a higher percentage on their income. The highest category will be a formula that will continue to increase as income increases, but never reach 100% or make it such that income after tax is equal to or less than the tax at a lower income level.
I feel like the facility constrtuction expense credit might not be big enough to invite investors. It may need to be reworked or comoletely tossed out and replaces with so.ething different. The point is that we will need to make it so that an investment in the facility will be paid back in time and be worth while for large investors (ones that would invest billions).
In any event these are all just some thoughts to get the ball rolling. Ultimately this is a complex question that will need to be answered before any major investors will sign on. Thoughts? Other ideas?