Saturday, January 7, 2017

Banker bot can tax

import tradingpit as Pit
Pit.boss = IncomeTaxColletor
Pit.coin = TaxRelief

It is simple, The legislature passes the income tax, progressive, give it an intercept even. The pit boss sells tax relief according to the law. Whenever tax payer buys a relief, they get registered on the tax relief block chain
OK, how does the government measure who pays what? Same way they do now, smart contracts, accountants doing god's ether work; with IRS shoe leather right behind..

Wait, can;t our smart cards obey income tax law automatically? Sure, but I will need a hefty discount before I sign up for automatic withdrawal, and I am going to want a fair bot on the collector side.>

Now, income tax relief is priced compressed according to the income tax law. The law has to specify precision if its is fair. So trading pit flex prices according to defined, legal rules, governing tax collection. For example, the tax bit error should reflect seasonal adjustment, or the current tax surplus/deficit must not exceed some percentage GDP. Easy rules for the pit boss, and the Coase guy is happy.

Tax relief can be bought and sold at zero transaction costs, the smart cards understand its value. The bots can operate with external application that do sophisticated tax sniffing, picking buy and sell opportunities, to align with your own expected liability.

How does the smart card treat tax cheating?

The card knows taxes have a red and green, no more. Most of the tax applications make rec cheat, green honest, and amber is what the tax lawyer can almost prove. The cards only job is to make sure the app does not cheat you, and the card is also bound to keep any agreement it makes that you have approved. Even so, before testifying in tax court, your bot will ask you for a second approval; unlike the Amazon loudspeaker that just blabs everything to the cops. 

What does the tax collector trade for tax relief? 
Any secure digits in the sandbox, likely it runs with a large list. It is immaterial. A secure digit is tradeable, and has a priced currency risk. It is reasonable to accept any currency with less than 5% volatility over some total count. Then, a few strokes of the keyboard, and the Treasury secretary can have whatever currency Congress needs at the moment.

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