We're approaching tax season for regular employees in Japan and I'm updating my Slack dingwords to include all of my weird but suddenly acutely relevant hobbies.
"Ah yes you would think that iDECO is 個人年金 since it is, after all, a pension (年金)which you pay for for yourself(個人), but you'll copy that information into the 小規模企業共済 box instead. Why is a fascinating story; do you want to hear it?"
It's probably not my most leveraged way to make a dent in geeks' financial futures but the salaryman in me does think that I owe junior coworkers literally up to the legal limit of Not Investment Advice so they can scoop up the sweet sweet ~$400 of tax benefit available.
I was geeking out with my brother about this and he, a government employee no less, said "Patio if that is unscalable clearly its negative expected value for you to even think of it" and I said "Probably true but I get to tell stories about understanding Japanese tax procedure."
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I feel unreasonably proud as a Chicagoan interested in credit cards that when I got the email about Reserved by Sapphire I said “Chase did Tock? No. Chase must be white labeling Tock.”
Tock is an amazingly brilliant business by the way, by the sort of restauranteur who also posts on HN for fun.
High end restaurants have an inventory management problem and the relevant inventory is seatings not food. Tock suggests they sell pre-paid reservations like shows do.
This way they don’t have to eat no-shows or parties which reserve a table for 8 but only show up (and pay for) 5.
Some people think that taxes are complex because the people who write or enforce the rules are perverse. I think it’s mostly because a) taxes are used to express society’s preferences and b) society’s preferences are complex.
For example, consider sales/use taxes around food. A key goal of most tax regimes is “progressive taxation”; you generally want to take more as a percentage from “richer” people and less from less well-off people. (Definition of “richer” also complex when you try to encode it.)
Let me illustrate with a single paragraph why this is obviously the future of e.g. equities research:
Substack has made it incentive compatible for the world's various obsessed experts on various topics to hire themselves out to the Internet rather than hiring themselves out to e.g. financial intermediaries, and then they do the sort of deep work that experts do.
Also: holy me do I not want to be the investment banker who let a math error work its way into an IPO prospectus.
e.g. I owe the National Tax Agency (Japanese IRS) some math every year about all of my overseas assets, including those which did nothing in a year, and the process of collecting that information looks something like this:
Non-AngelList investment from 2012: get docs out of Dropbox, grep inbox to see if e.g. this is the one that I remember signing the docs about a corporate transaction this year or not, math math math, en-spreadsheet.
AngelList: download report on all, send to accountant, done.
Some brief elaborations from the cutting room floor:
The essay talks about cross-subsidization at a few points. One fascinating form of cross-subsidization was that credit cards *changed who ultimately pays for an individual's use of credit.*
This had huge ramifications for small businesses, which are historically (and currently) horrifically capital constrained almost all of the time. They also have extreme difficulty in lining up traditional bank financing.
Credit cards let merchants opt-in to financing customers.
A quirky feeling I've had on our covid-19 response is that some institutions have difficulty doing things which are *clearly* within our capabilities while others are pushing boundaries in their respective fields.