With tears in my eyes and a smile on my face I did read the 'SPIEGEL', today.
Living in Germany, you have to be accustomed to certain absurd facts by now. For example, you should not be surprised to see some of the German states buying stolen goods. Data stolen from Swiss banks is bought on a regular basis by German tax authorities. Later on, this data is used to prosecute people cheating on German taxes by transferring their money to Switzerland.
Nevertheless, German authorities encourage employees of Swiss banks to steal data by demonstrating month over month that they are willing to pay millions of EUR for this data.
How about allowing 'people' to break into the apartments of tax payers to steal their personal documents showing tax fraud? How about paying them for such action?
Now it gets even better!
For years, German state argued that POKER is a game of chance. Therefore, you are allowed to play POKER for money (face to face, against computers, online) only in registered, licensed casinos. In Germany this means they are more or less state-run and the state takes all the profits. To play at Pokerstars.com for money is theoretically not allowed. And companies like bwin are prosecuted for not adhering to the rules. Internet knows no borders ... such rules get kind of absurd.
Good thing about German regulation: all your winnings in 'games of chance' are tax free in Germany. So all the state run games of chance lead to tax free winnings.
But now the tax authorities of Cologne changed their position: POKER is no game of chance. Therefore all the German winners at the World Series of Poker (WSOP), at PokerStars.com, and all the other events would be eligible for income tax.
(GULP)
So, when the state fears competition in 'games of chance', it declares POKER as game of chance. And therefore decides nobody but the state is allowed to run such games. And therefore bwin, PokerStars, PartyPoker .... they are considered like the Mafia as organized crime.
But when there are winnings to be taxed, POKER is no game of chance. So winnings and results from the game depend on skills and experience. Like a sport ... And therefore everybody playing regularly does so for an intention to make profits. And therefore can be taxed.
Related atricle of 'Der Spiegel'
Hey, maybe we use this kind of 'rationality' for our own purpose.
Capital gains. You have to pay tax on them. It is kind of an income tax ... in some countries you pay your personal income tax rate on capital gains, in others somewhat less.
But, let us face the realities. Capital gains are a game of chance!
Is there any rationality behind the valuation of governments bonds? Which of them will default, which not? Or is this only determined by political decisions without rational backing?
How many professional fund managers can outperform the market? Only a few? Are the returns from funds distributed like a bell-shaped curve? Yes? So if the distribution is bell-shaped, shouldn't that indicate a 'game of chance'?
Can anybody do a forecast on the timing of the next quantitative easing of the major central banks? No? Will that impact equity prices? Yes? If you cannot forecast it - won't it hit you like a non-predictable event? An accident? A game of chance?
How about taxes, duties, anti-dumping fees? Can you really predict new legislation on such items?
And what about incentives? German renewable-energy refunds? Italian ones? Tax credits? Predictable? NO? The impact on single stocks - a game of chance!
There are a lot of arguments why investing money in the capital markets is not a profession, but a game of chance. The mediocre or even worse rates of return of the average, 'professional' (meaning: dedicating lots of time) investor being one of the strongest.
So why should a private person, having only limited time and money resources available, pay tax on capital gains? If even the most educated persons, dedicating all of their work time cannot achieve above-average results? Why should the private investor having less resources available, be able to achieve positive, year-in year-out results? And if that is not the case ... doesn't it sound like a 'ame of chance'?
Conclusio: Investment is a game of chance! It should not be taxed!
No comments:
Post a Comment