-----BEGIN PGP SIGNED MESSAGE----- ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ SANDY SANDFORT Reply to: ssandfort@attmail.com . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . C'Punks, Hal still has his doubts about crypto and taxes. He wrote: I can agree that cryptography will make some kinds of illegal private transactions easier. What I doubt is that this will happen at a large enough scale to seriously threaten the ability of governments to fund themselves by taxes. Government tax policies are extremely susceptible to the "tipping factor." Initially, non-compliance is addressed by simply hiking up collections across the boards. When non-compliance reaches some critical factor, however, such techniques become counter- productive. Previously compliant taxpayers begin to chaff at higher taxes and more aggressive collection. More and more become non-compliant as taxes go higher and higher. Eventually, the runaway chain reaction either causes the government to cut back or the system undergoes a core melt-down. Non-crypto versions of this scenario have occurred repeatedly in countries around the world. Hal also have several specific examples of transactions he felt demonstrated the difficulty of using crypto-anarchy techniques. Perry and others have address some of these, but one or two things should be added to round out the picture. Hal wrote: Most of our transactions are done with businesses, generally corporations. Imagine taking $15,000 in cash to buy a new car anonymously. I believe you will find that the car dealers will not cooperate, that government regulations (designed to crack down on drug dealers) will require them to get some ID from you. Digicash would presumably be under the same restrictions. Maybe, but the example begs the question. You don't need to *own* a car, to have the *use* of a car. Imagine leasing a car and using your cyberspace bank digital checks, digital money or credit card to pay the monthly rent. No audit trail, and no asset to be seized. Similar techniques can be used for virtually all of your assets. Don't like renting? Well there are other offshore techniques that can cure that problem as well. I don't fully understand Duncan's arguments for how taxes can be avoided through being a non-citizen. I gather, though, that this would require me to either move to another country, or to go to work for a company that is in another country. . . . I think Hal hasn't been reading Duncan or my posts very closely. Here's a hint: A Cayman Islands corporation is a non-US citizen even if it is owned by an American. You have questions? We have answers. S a n d y
Please send e-mail to: ssandfort@attmail.com <<<<<<
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