Jared Walczak

Senior Fellow, Tax Foundation | President, Walczak Policy Consulting

[Erica York @ericadyork]

New from @DiSalvoPhD and me: Capital Is Not Taking Half of America’s Income, and Other Myths About the “Labor Share”

https://t.co/nG9m0ZckQd

[Jared Walczak @JaredWalczak]

@joelgombiner @adamnmichel 1,500 average American homes currently use more data than was used worldwide in 1996. We wouldn't be *that* efficient! (Unless the tax meant the internet failed to develop.)

[Jared Walczak @JaredWalczak]

@rickcarlotti @adamnmichel @LPDonovan 8 cents per MB (1 cent per Mb) on 9.8 TB of average household usage.

[Jared Walczak @JaredWalczak]

Okay, but how many Hollywood films are being shot in Spain and Ireland? How many are shot in New Zealand, at least for reasons other than needing a backdrop that looks like New Zealand? Surely the U.S. isn't struggling in the English-language big budget film department.

To which I'd also add: does it even matter? This will lose revenue with very little return. If we're willing to reduce revenues further, surely we can do far better for the economy.

[Jared Walczak @JaredWalczak]

Federal film tax incentives almost make (terrible, costly) state film tax credits look good.

At least the state credits shift activity to the state in question, even if it's short-lived, largely untaxable in-state, and creates few permanent jobs. What would the federal ones do?

[Jared Walczak @JaredWalczak]

But federal tax incentives won't even attract much. Yes, some films are produced in Canada, Australia, or elsewhere, but the vast majority of the incentives would likely flow to productions that would have happened in the U.S. anyway, and without growing the industry much. Why?

[Jared Walczak @JaredWalczak]

States spend ridiculous sums attracting film production. Even if one favors economic development incentives, the ROI on these is uniquely bad: few new jobs and very little lasting investment.

They work in the sense that they attract film production, but not in promoting growth.

[Jared Walczak @JaredWalczak]

@bradsferguson https://t.co/YibmTT0mEv

[Jared Walczak @JaredWalczak]

Several years later, there were proposals for an *actual* email tax. There are decent objections to that as well, but there was also a legitimate logic to a per-email tax that doesn't extend to a bit tax.

Proponents of the bit tax framed it as the equivalent of one cent per 100 emails, but it was really one cent per Mb (8 cents per MB). A tax on emails would have captured the negative externality of unwanted emails. A tax on bits, however, would have been wrongly measured, and would have discouraged innovation. Bits and data are not negative externalities. Spam and unwanted email are.

A trivially small tax on email, perhaps with some large exclusion that would cover the use cases of average people, could have imposed a modest cost on legitimate marketing while making spam more costly. Bill Gates proposed this decades ago, and there have been similar proposals to cut down on telemarketing by taxing phone calls above some threshold. In both cases, the ad quantum tax would apply to the specific activity we might actually want to limit. A bit tax, or a token tax, however, applies to data, no matter how it's used. That would have seriously held back innovation.

[Jared Walczak @JaredWalczak]

@George_A_Callas No, that's not what I'm referencing. If you read the linked article, I'm talking about policy proposals to impose a "bit tax," which were framed as the equivalent of 1 cent per 100 emails.

[Jared Walczak @JaredWalczak]

30 years ago, policymakers considered a "bit tax" framed as 1 cent per 100 emails. Against today's internet use, that's an impossible $780,000 per household.

With a bit tax, the internet would have developed quite differently. A lesson for AI taxes.

https://t.co/y40w6ZvoZZ

[Jared Walczak @JaredWalczak]

@RichardMorrison I should probably clarify that I am referring to actual proposals from economists and tech leaders, and not to email hoaxes warning you that if you didn't forward this email, you'd soon have to pay tax on every email you forwarded.

And you'd make little Billy Evans sad.

[Jared Walczak @JaredWalczak]

Several years later, there were proposals for an *actual* email tax. There are decent objections to that as well, but there was also a legitimate logic to a per-email tax that doesn't extend to a bit tax.

Proponents of the bit tax framed it as the equivalent of one cent per 100 emails, but it was really one cent per Mb (8 cents per MB). A tax on emails would have captured the negative externality of unwanted emails. A tax on bits, however, would have been wrongly measured, and would have discouraged innovation. Bits and data are not negative externalities. Spam and unwanted email are.

A trivially small tax on email, perhaps with some large exclusion that would cover the use cases of average people, could have imposed a modest cost on legitimate marketing while making spam more costly. Bill Gates proposed this decades ago, and there have been similar proposals to cut down on telemarketing by taxing phone calls above some threshold. In both cases, the ad quantum tax would apply to the specific activity we might actually want to limit. A bit tax, or a token tax, however, applies to data, no matter how it's used. That would have seriously held back innovation.

[Jared Walczak @JaredWalczak]

I think an *actual* email tax could have been reasonable!

Proponents of the bit tax framed it as the equivalent of one cent per 100 emails, but it was really one cent per Mb (8 cents per MB). A tax on emails would have captured the negative externality of unwanted emails. A tax on bits, however, would have been wrongly measured, and would have discouraged innovation.

Bits and data are not negative externalities. Spam and unwanted email are. A trivially small tax on email, perhaps with some large exclusion that would cover the use cases of average people, could have imposed a modest cost on legitimate marketing while making spam more costly. Bill Gates proposed this decades ago, and there have been similar proposals for phone calls to cut down on telemarketing. In both cases, the ad quantum tax would be on the specific activity that we might actually want to limit.

A bit tax or a token tax, however, is simply on data, no matter how it's used. That's fundamentally different.

[Jared Walczak @JaredWalczak]

@AIQuanting Yes, that's the argument.

[Jared Walczak @JaredWalczak]

@aelfred_D This is an imperial diet. Most worms are peasants.

[Jared Walczak @JaredWalczak]

It's clearly ludicrous that the President is renaming international bodies of water on a whim. It's embarrassing. But it doesn't work for maps to adopt names that are different than the official name for a place or body of water, however dumb that (I hope temporary) name is.

[Jared Walczak @JaredWalczak]

Is it cringeworthy to open a maps app and see "Lake America"? Yes. But if the US Geological Survey, the Board on Geographic Names, and their Geographic Names Information System say that's the name now, map apps more or less have to acknowledge it until it's reverted.

[Jared Walczak @JaredWalczak]

@CaseyMattox_ By "average," it means that it averaged the appearance of all the presidents.

[Jared Walczak @JaredWalczak]

We're going to need a new AI detection tool.

[Jared Walczak @JaredWalczak]

"I like Ike, You Like Ike, Everybody Likes Ike"

Trump:

[Politics & Poll Tracker 📡 @PollTracker2024]

President Trump list his personal greatest presidents besides himself

Abraham Lincoln
George Washington
Franklin D. Roosevelt
Woodrow Wilson
Thomas Jefferson
Andrew Jackson