The Trump tax policy allows work-arounds, it seems

Trump may be anti-elitist in that he believes, and seems to enforce, the idea that authoritarian tribalism makes the world function better for “your own people”.  The new GOP tax law, which is largely Trump’s first “achievement”, seems to reinforce that idea in several ways.

The tax policy is said to penalize residents of states with high state and local taxes and high state services. It is said to reward the “real world” economy supposedly in midwestern and southern states at the expense of the intellecuality and abstractions of the coasts.  Sounds like my first attempt at a book, “The Proles”.

James M. Pettit explores this idea in National Review, where he shows how blue states lose residents to red states.  Despite the situation right now in 2018, this could help “conservatives” in the long run. But we’ve seen this before.  I left New York City at the beginning of 1979 (a few years after NYC’s own “drop dead” financial crisis in 1975) for the lower taxes and living costs of Dallas.  Along with that came more conservative social values.  There was a tendency for families to segregate and for companies to move to the far northern suburbs (like Plano) to “get away from the blacks”. Moving probably delayed and prevented my own exposure to HIV, but we had to deal with a mean anti-gay climate in the early 80s when AIDS was first being publicized.  But generally, “conservative” areas want to see outlier people (like me) socialized into vertical tribes (extended families) so that governments don’t have to do as much.

But Vox (Dylan Matthews) proposes a scheme where blue states go to employer payroll taxes as opposed to state income taxes.  This would mean lower wages at first but possibly workers (and many employers) come out better after taxes are done, under the new scheme.

On January 1, Noam Scheiber (in Business Day, New York Times) suggested that the new tax law will encourage more workers to become independent contractors, because sole proprietorships will now be able to deduct some expenses. If I really sold more individual copies of my own books (or really tried and got more advertising revenue from my blogs) this could help me.

And today, David Herzig (p  A15) suggested that states are losing sales tax revenue when you buy online (except through Amazon Prime, which collects it). One issue is that states (according to an earlier Supreme Court ruling, which may get overturned) can only enforce taxes in states where they have physical presence (and Amazon is building its own stores). I actually started filing sales tax with Virginia in 2016, and have made a practice of paying it to Virginia wherever books are sold (like Washington DC book fares). In a few cases I have given complimentary copies and reported them as sales and paid a small tax. I stopped for a while when I moved because of possible issues regarding business licenses and the new condo residence (my “downsizing”) but I expect to resolve this by March.

All of this suggests I need to get more serious about “selling” on a transaction level myself, and I’ll get into that soon.

(Posted: Tuesday, January 2, 2019 at 10 PM EST)

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