Comments by "looseycanon" (@looseycanon) on "High tax states start fighting each other over who gets to collect." video.
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@radekmojzis9829 Well, on the other hand, we have to pay conversion fees, whenever we're trading with our immediate neighbours, three of which have Euro already, in a pro export economy, that, like most economies in the world, trade's the most with their emediate neighbours. And can't take advantage of West African (CFA) Frank, which is linked on fixed rate to Euro... And until next jaunuary had to pay our income tax based of employer expences, not agreed wage and have effectively the highest taxation of labour in the world... Yeah, fun country the Czech Republic :D
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hm... Like it or not, this will require federal intervention. Why? Until recently, work didn't cross state lines and until even more recently, it was in relatively small number of professions, like train drivers, train engeneers, pilots, stewards... But now, with Internet being so ubiquitus and companies realizing, everybody can work from anywhere, especially with Starlink in the ISP game, new rules need to be implemented, because states like Tennesseee, Arkansas or West Virginia are gonna become magnets for young people, wanting to root in, thanks to cheap land for residential development, but the largest companies will remain in NY or Texas.
The way I see it, this mess can be solved in two ways.
One, the higher tax has precedence, but lower tax has priority. The most, that would have been payed is the higher rate, which then would be split betwene the states. For example, let's take states of Colorado and North Carolina, as it is easier, because they have flat tax rates. If a guy lived in Colorado, but worked for a company that is based in North Carolina, he would pay 5,25% tax, which would then break in to 4,63% for Colorado and the difference of 0,62 for North Carolina. And it would boost demand for accountants, because other states don't have flat tax rates and things can become very confusing very fast, as US wide, there are more than one change in tax law per day and accountants in the US can't keep up, so some federal involvement would be necessary even on state and municipal level for the system to work (I'm not talking full on dictatorship, I'm talking US wide yearly deadline for changes in state and lower tax codes after which all further changes would apply to the next). There is a huge drawback in this, however, because, when the scenario is flipped, all tax goes to North Carolina and Colorado get's nothing, but still has administrative expences with the company based in the state. This could be solved by splitting the tax evenly, but that would create incentives in state's with higher taxes to create special taxes on companies, that employ remote workers, to supplement this loss of income, which would likely translate in to lower wages for remote workers, which in turn would unleash a tsunami of discrimination litigation.
Alternatively, a rule could be established, that taxes follow the contract and a rule for this rule, that only those state laws, in which either entity reside's are applicable. Meaning, if a guy worked for a New York company in Texas, he would have a choice, betwene Texas and New York law systems in terms of work and tax, however, this create's problems of their own, as a Texas sherriff might have to administer New York law, which, jurisdictional questions aside (as this likely violate's states rights), he may lack training for, and he would have to be at least knowlegable about all 51 possible jurisdictions (50 + DC and teritories), which is unreasonable requirement at best. At this point, the sherriff might rather be called Waleker, Texan Federal Labour Ranger. Not to mention the fact, that the core problem remain's, one of the states get's nothing, even though it does have expences with either that worker or the company. And not to mention the option of unions! How they are hated in the South aside, one company could end up with two seperate unions with very different scopes of power in one state, because of how they are rooted in NY and Texas law is very different, plus either would likely lack jurisdiction over contracts signed under the other law. Furthermore, such system is less predictable, as our guy from Texas could move to Florida for a while (like, taking care of elderly family member came up), and if the contract was signed under Texas law, a new contract would have to be signed, as Texas jurisdiction is no longer available.
I really don't like income tax. Not because it's a tax, but because it doesn't tax capital equally to labour. And it's actually harder to get the money out of people and corporations alike, when compared of sales tax, property tax or VAT. When you tax consumption, you tax all means of production and thus reduce inequality, while filling the state coffers. Plus, the little guy has greater controll over his taxation, as he can simply consume less, as long as he can survive.
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