A tax combinator library could be useful for Rules-as-Code [lightning talk]

Lightning talk at Everything Open 2023.

I demonstrate the Haskell /tax/ library and introduce /tax-ato/,
a library for Australian personal income tax calculations.

Transcript

1. A tax combinator library could be useful for
   Rules as Code
   or: surely you didn’t think you’d escape without hearing me talk about Haskell?
   Fraser Tweedale
   @hackuador@functional.cafe
   March 16, 2023
   

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2. Rates Rebate Act 1973 (NZ) s 3(1)
   A ratepayer who, at the commencement of a rating year, was the
   ratepayer of a residential property is entitled, on application
   in that year, to a rebate of—
   (a) so much of the rates payable for that rating year in respect of
   the property as represents—
   (i) two-thirds of the amount by which those rates exceed $160,
   reduced by—
   (ii) $1 for each $8 by which the ratepayer’s income for the
   preceding tax year exceeded $28,080, that last-mentioned
   amount being increased by $500 in respect of each person who
   was a dependant of the ratepayer at the commencement of the
   rating year in respect of which the application is made; or
   (b) $700,—
   whichever amount is smaller.
   

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3. incomeThreshold :: Natural -> Money Rational
   incomeThreshold numDependants =
   Money (28080 + fromIntegral numDependants * 500)
   reduction :: Natural -> Tax (Money Rational) (Money Rational)
   reduction numDependants =
   above (incomeThreshold numDependants ) ( -1/8)
   rebate :: Natural -> Money Rational
   -> Tax (Money Rational) (Money Rational)
   rebate numDependants income =
   lesserOf
   ( lump (Money 700))
   ( greaterOf
   ( lump (Money 0))
   ( above (Money 160) (2/3)
   <> lump ( getTax (reduction numDependants ) income )))
   

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4. Combinators:
   functions that compose smaller computations into a more complex
   computation. . .
   that (typically) follow some laws. . .
   such that our ability to reason about the computation can scale as it grows.
   

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5. medicareLevy loThreshold =
   lesserOf ( above loThreshold 0.1) ( flat 0.02)
   

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6. lowIncomeTaxOffset =
   limit (Money 0)
   ( lump (Money ( -445))
   <> above (Money 37000) 0.015
   )
   

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7. individualIncomeTax = marginal’
   [ ( 18200 , 0.19 )
   , ( 45000 , 0.325 - 0.19 )
   , (120000 , 0.37 - 0.325)
   , (180000 , 0.45 - 0.37 ) ]
   

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8. data Tax b a = Tax { getTax :: b -> a }
   deriving ( Semigroup, Monoid, Functor, Profunctor )
   

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9. allTheTaxes =
   individualIncomeTax
   <> medicareLevy (Money 23226)
   <> lowIncomeTaxOffset
   weeklyWithholding = dimap ($* 52) ($/ 52) allTheTaxes
   fnlyWithholding = dimap ($* 26) ($/ 26) allTheTaxes
   monthlyWithholding = dimap ($* 12) ($/ 12) allTheTaxes
   

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10. https://hackage.haskell.org/package/tax
    https://github.com/frasertweedale/hs-tax
    blog post: https://is.gd/tax_combinators
    useful for "Rules as Code" calculations
    relating to tax, levies, rates, rebates,
    payroll...
    

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11. What do /I/ use it for?
    hs-tax-ato - personal income tax library
    https://hackage.haskell.org/package/tax-ato
    https://github.com/frasertweedale/hs-tax-ato
    

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12. hs-tax-ato: stuff that’s implemented
    individual income tax, employee share schemes
    Medicare levy, Medicare levy surcharge
    HELP (HECS/SFSS student loans)
    deductions
    offsets: low income, LMITO, spouse contribution
    private health insurance rebate adjustments
    dividends, CGT, foreign income, foreign income tax offset
    rates/rules for previous financial years (back to 2017)
    

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13. hs-tax-ato: stuff that’s NOT implemented
    PAYG instalments (coming soon)
    some adjustments/variations based on family income or dependents
    partnership/trust/personal services income
    super income streams and lump payments
    some "grandfathering" rules (e.g. CGT indexation method)
    lots of other esoteric (to me) features and quirks
    

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14. hs-tax-ato: known issues
    needs updates for 2022–23 FY (coming soon)
    missing some rounding steps
    lack of usage examples
    

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15. Maybe these libraries will be useful or interesting to
    someone...
    

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16. © 2023 Fraser Tweedale
    Except where otherwise noted this work is licensed under
    http://creativecommons.org/licenses/by/4.0/
    Code https://github.com/frasertweedale
    Blog frasertweedale.github.io/blog-fp
    Fediverse @hackuador@functional.cafe
    

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