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Free software does not contribute any tax
Posted: Tue May 06, 2008 11:04 am
by allix
I found this article interesting, its an area that's I have not seen mentioned at all.
Paying tax benefits us all, if its not used by politicians for there own expensive needs.
A solution could be for projects and distros (which are not companies already )to set-up pay-pal or something similar accounts that go straight to the tax office.
Free Software vs. the Tax Man
Slashdot recently linked to this comparison of the cost of Windows in Brazil and the US. This brings to mind a point I think I’ve seen Mike make: beyond the general point that libertarians should celebrate free software because it’s an example of non-coercive production of public goods, libertarians also have reasons to like free software because it’s more resistant to the coercive power of the state. When software is produced by a commercial company and sold in the marketplace, it’s relatively easy for the state to tax and regulate it. Commercial companies tend to be reflexively law-abiding, and they can afford the lawyers necessary to collect taxes or comply with complex regulatory schemes.
In contrast, free software will prove strongly resistant to state interference. Because virtually everyone associated with a free software project is a volunteer, the state cannot easily compel them to participate in tax and regulatory schemes. Such projects are likely to react to any attempt to tax or regulate them is likely to be met with passive resistance: people will stop contributing entirely rather than waste time dealing with the government.
Hence, free software thus has the salutary effect of depriving the state of tax revenue. But even better, free software is likely to prove extremely resistant to state efforts to build privacy-violating features into software systems. CALEA requires telecom infrastructure to include hooks for eavesdropping by government officials, but it will prove extremely difficult to get similar hooks added to free software. No one is likely to volunteer to add such a “feature”, and even if the state added it itself, it wouldn’t have any realistic way to force people to use its version.
http://techliberation.com/2008/05/05/fr ... e-tax-man/
Re: Free software does not contribute any tax
Posted: Tue May 06, 2008 2:19 pm
by Wally Balljacker
Well obviously the original developers generally don't sell their software themselves. But it eventually gets taxed and sold through companies like Redhat or Novell, or Terra Soft, or any other Linux vendor. I don't quite understand how Linux "evades" taxation... there are countless Linux companies that sell FOSS software and support. The development model may be different from the proprietary model, but RedHat functions just like any other software company.
Re: Free software does not contribute any tax
Posted: Tue May 06, 2008 2:44 pm
by allix
Wally Balljacker wrote:Well obviously the original developers generally don't sell their software themselves. But it eventually gets taxed and sold through companies like Redhat or Novell, or Terra Soft, or any other Linux vendor. I don't quite understand how Linux "evades" taxation... there are countless Linux companies that sell FOSS software and support. The development model may be different from the proprietary model, but RedHat functions just like any other software company.
well there is more proprietary commercial software than commercial software that's based on free software. For every Red Hat or novell, there are 100s of proprietary commercial products that brings in more tax. If I decide to make some free software and just stick it on a server and not sell it commercially, then no tax is going to be contributed of course i could make it proprietary and not sell it.
Basically the blog post is saying most free software does not become commercial therefore bringing not contributing to tax.
Re: Free software does not contribute any tax
Posted: Tue May 06, 2008 4:04 pm
by snarkout
To avoid any repeat of my RMS/OLPC tantrums, I'll just say this - the person who wrote that article wasted a lot of their own time and a few minutes of mine.
Re: Free software does not contribute any tax
Posted: Tue May 06, 2008 4:14 pm
by LinuxMint-4
Then there is that "other" tax. The Microsoft tax.
Re: Free software does not contribute any tax
Posted: Tue May 06, 2008 4:26 pm
by greggh
Snarkout wrote:To avoid any repeat of my RMS/OLPC tantrums, I'll just say this - the person who wrote that article wasted a lot of their own time and a few minutes of mine.
I have to agree with you completely on this one. We are talking about people contributing value to the community and helping their neighbors without expectation of financial recompense. Why would it even cross anyone's mind that it would be a good thing for the government to tax such a thing or seek to regulate it?
Re: Free software does not contribute any tax
Posted: Tue May 06, 2008 11:46 pm
by adam
neither does proprietary freeware.
Re: Free software does not contribute any tax
Posted: Wed May 07, 2008 12:21 pm
by Vogateer
greggh wrote:Snarkout wrote:To avoid any repeat of my RMS/OLPC tantrums, I'll just say this - the person who wrote that article wasted a lot of their own time and a few minutes of mine.
I have to agree with you completely on this one. We are talking about people contributing value to the community and helping their neighbors without expectation of financial recompense. Why would it even cross anyone's mind that it would be a good thing for the government to tax such a thing or seek to regulate it?
Wait, the point being made—whether one agrees with it or not—is completely the opposite of your last sentence. The writer is saying that free software is resistant to the
controlling effects of taxation, and is saying that it would be a
bad thing if the government could use taxes or regulation to control or influence free software.
The government uses taxes as a control mechanism. Taxes are used as "carrots and sticks" to get businesses and people to do what the government wants. The government wants you to do something, they give you a tax break to do it. The nature of free software makes it difficult for the government to use this method of control and influence.
Simply imagine that the government might offer a tax break to a software company if they include some way for the government to monitor that software's usage and get information from it. Getting a tax break would give you a leg up on your competitors, so it's at least a tempting proposition. Even if the government tried to use taxes to persuade Novell or Red Hat to include such functionality, people would simply strip it out and lose faith in the company that did it. Therefore this type of government influence is rendered useless.
Seriously, it's like everyone here isn't reading the same article I am.
Re: Free software does not contribute any tax
Posted: Wed May 07, 2008 1:22 pm
by snarkout
My point was the article was full of non sequiturs and blinding flashes of the obvious, not that I disagreed with anything said, really. I mean, WTF does CALEA have to do with software development models?
Re: Free software does not contribute any tax
Posted: Wed May 07, 2008 1:32 pm
by Vogateer
You may be getting the point of the article, but it appears to me that others aren't.
The point with CALEA is that the government can use taxes and regulation as strongly persuasive tools to convince software companies to include wiretapping features in their software, enabling the government to listen in on computer communications like they can on phone conversations. With proprietary software, this functionality can be included, and since the source isn't available, you can't simply strip out such eavesdropping functionality like you can with Free software.
The nature of free software and availability of source code means that any government efforts to use taxes and regulation as a tool to persuade a company to include such wiretapping features would be pointless. Other programmers would look at the source, strip it out, redistribute it, and be done with it.
Perhaps my tastes in writing are less discerning than yours, but I don't think the article is so badly written (it wouldn't win any writing awards to be sure, but it's perfectly understandable), and I don't see the non sequitors you do. The article makes sense to me, and pointed out a benefit of free software that I hadn't thought of.
Re: Free software does not contribute any tax
Posted: Wed May 07, 2008 2:30 pm
by Vogateer
This is slightly tangential, and I want to be clear that I'm not asking this in a sarcastic tone, but I truly want to know what it was that caused the point of the article to be ignored or misunderstood by most of the responses. I know the article wasn't as cleanly structured and written as it could have been, but I don't think it was so poorly written as to be misunderstood by a good number of the TLLTS crowd. Was it because Allix started the conversation with an opening that had nothing to do with the point of the article? Did that affect the way everyone else read the article? Did people just skim the article? Was everyone just responding to Allix's comments or the comments of others?
I know from experience that everyone here is intelligent and knowledgeable. I am interested in communication and the challenge of getting an idea from one person's brain to another's, and the fact that so many bright people didn't bother with the article's point raises these questions in my mind.
Re: Free software does not contribute any tax
Posted: Wed May 07, 2008 3:06 pm
by allix
Sorry, I did not mean to accentuate my own opinions over the article before anyone had read it.
Re: Free software does not contribute any tax
Posted: Wed May 07, 2008 6:32 pm
by snarkout
Maybe I never got past the CALEA thing, which is what I used "non sequiteur" to describe. CALEA is part of a regulated indistry - LECs and CLECs have no choice in the matter. If they want to play, they play by the government's rules - it has nothing to do with taxation or *LECs being leaned on. There is no Free option that would get around this. To me, this is as absurd as saying that it's against the law to cyber-squat on unsecured WAPs, and Free software wouldn't have to be beholden to government pressure. That makes no sense, right? I think perhaps what they were reaching for was more similar to how certain closed encryption algorithms supposedly contain back doors - with FOSS based encryption and standards based encryption, this isn't as much of a threat (though some folks still feel that there might be back doors in sat 3des). I dunno, I'm obviously being a grouchy bitch recently, though, so sorry for that.
Re: Free software does not contribute any tax
Posted: Wed May 07, 2008 8:51 pm
by Vogateer
allix wrote:Sorry, I did not mean to accentuate my own opinions over the article before anyone had read it.
No need to be sorry about giving your opinion. I like hearing people's opinions. I was just surprised at how the article's meaning was lost to a few people. I'm just assuming that others read your emphasis on the taxes part of it and that it somehow affected their reading of the article.
Snarkout, I think I better understand what you're getting at now. The writer mentioned CALEA merely to give an example of the sort of wiretapping regulation that would be difficult to enforce on free software, and you're questioning that, right? Unfortunately I'm having trouble understanding the example you gave; I think I'm getting tired for the night and not thinking as clearly. But the writer mentioned both taxation and regulation as methods of government interference, and I understand CALEA to be regulatory in nature.
I'm assuming the government would love to have access to the information that so many computer programs handle. Financial software, communication software, and many other areas, I'm sure. Even if the government sought to regulate such software, couldn't Free software merely be developed on servers where there isn't such regulation? It sounds like you're catching something about this that I'm not, but the availability of source code giving you the freedom to modify the software on your machine does make it a much more challenging target for such regulation.
Re: Free software does not contribute any tax
Posted: Sun May 11, 2008 1:51 am
by eddie
I am sure that my view is completely wrong but, you have to purchase equipment to run linux. One indeed does pay a tax on that. The average linux user probably spends even more on equipment as a whole.