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by klipt 703 days ago
Per Henry George we should tax this kind of speculation and rent seeking, by taxing things like land and internet domains.

We could use the money to reduce our national debt, or pay for things like healthcare and education.

3 comments

I don’t think Georgism applies very cleanly to the DNS. It works well for land because a Georgist tax is essentially an incentive to improve the land or sell it to someone who will; it’s unclear that a tax on milk.com will improve milk.com.
In what way is he actually speculating or rent seeking? He has a real website on it — not just a placeholder — and he's got DNS MX records, so it's presumably actively used for email.
The website is just saying "make me a high offer", that seems like 100% speculation?
As I get it, this guy is not making any money from owning the domain, and doesn't seem to be actively trying to. What would you tax then ?
A tax is usually a percentage or income but my definition it need not be. It can be a flat tax. Or a tax on an assessed value, like a property tax.

I think the idea is if you tax people ~$1k/year/.com domain or 5% of the assessed value then you have fewer domain squatters and fewer stagnant domains. I guess students, hobbyists, etc. would then have to move to a corporate entity like GitHub Pages, Netlify, etc.

A tax on assets resuces some problems but creates others.

Thanks for the explanation.

I get the feeling it would be problematic for situations like one day Tesla getting bankrupted and would not able to keep paying a gigantic tax for tesla.com, when cars are still using it to check for updates or DRM access, and customers still go there to get support.

IMHO the domain tax having nothing to do with the value extracted from it doesn't fit with what we the role we give domains in our current world (which is also a reason why domains are so important)

You'd tax them some proportion of the fair market value of the domain, not their revenue, just like with any other form of land.
How would you calculate the FMV of milk.com?
What's the highest offer for it that you've rejected? That seems like a fair lower bound.

(Not that I necessarily support a Georgist tax in this case, since it seems that your interest in the domain is noncommercial in nature)

Wouldn't that allow random people to increase your tax on domains you obviously don't want to sell ?

E.g. if you owned and actively used greyface-.com and I'd make an offer of 10 000$ just for the fun of it, either you literally give up your name (I eat the cost but that's a risk I could want to take) or you're stuck with a percent of that to pay every month/year even as nothing else changed for you.

> E.g. if you owned and actively used greyface-.com and I'd make an offer of 10 000$ just for the fun of it, either you literally give up your name (I eat the cost but that's a risk I could want to take) or you're stuck with a percent of that to pay every month/year even as nothing else changed for you.

If you're willing to pay $10000 for it, even if only out of spite, then it's worth that much yeah. The domain is suddenly in more demand than it was, taking it out of circulation is a bigger imposition on society than it was before, so isn't it right that the tax on that goes up?

> I eat the cost but that's a risk I could want to take

You also have to eat the increased tax going forward. Which could be spent on eg universal healthcare.

I know of no truly serious offers for the domain, but why should that matter? I'm pretty sure residences aren't taxed based on un-accepted offers, for example.
Residences are taxed based on appraised market value; I think offers made can be taken into account on that? If not then they should be.
You'd have an assessor compare it against domains that had traded recently (someone else mentioned beer.com), perhaps ask interested buyers to give a quote.
Are you proposing every domain name registrant pay for an annual appraisal, whether or not they are planning on selling?