re: #234 EPR-radar

Suppose Joe Billionaire’s personal tax avoidance vehicle has 100 million in income in year X. Suppose Joe takes out only a modest amount of 500K that year for living expenses etc., leaving the rest of the income in the corporation for future business activities etc.

With no corporate tax, it look like there is only 500K to tax here. Furthermore, if Joe’s tax avoidance vehicle is some kind of perpetual corporate trust, there may never be a clear distribution of income/assets to beneficiaries of the trust.

Yeah, ideally, that’d be taken care of by the limited duration of corporations, but I know we’re probably never going to get that.

The solution for that is a kludge, it’s a cash reserves limit. I forget which economist came up with it, but for a kludge, it’s a really nice fit: basically, a cap on cash reserves as compared to income and expenditure, and if the amount of cash reserves is over X, the money is automatically invested in US savings bonds. The money has to eventually come out in some way or another, and you can tax it then, and until then, the money gets put back into the economy.