1) In many countries, unlike USA, a majority of people don't ever handle a "tax return" or "file taxes" - if your income consists of standard salaries or student stipends or social security/etc, then the employer is required to handle everything and you can generally ignore the issue unless you start doing business or selling real estate or whatever. For a normal person, the cost of starting to file taxes (and investigating how it needs to be done) it's orders of magnitude larger than any reasonable amount of tips - generally, hiring an accountant would be cheaper&safer than doing it yourself and any non-standard income less than the accountant fee is not worth the hassle.

2) Those tips are strictly different from personal gifts - they're payment (voluntary, but still) for stuff you did, so tax wise, they would be considered equivalent to commercial export of software. Taxes on international commerce are tricky (e.g., determining if value added tax applies in this case, etc), most jurisdictions have some simplified paperwork, guides and assistance for small business with the expectation that they're domestic, not international.

3) If you're asking "which specific law prohibits" - it's entirely opposite, it's not like there are specific laws for each taxable thing - the general law mandates that any and all income is declarable and taxable, and then there are specific laws to make exceptions for things such as birthday gifts from relatives or tips for waiters.

> Could you explain why accepting tips is so complicated? What specific law means you cannot do it?

If tips come in individually and in small numbers and you need to track the rate of exchange, origin and everything the money I lose money actively by needing to track it. There is no point in accepting small amounts.

The reason actual tips work in Austria is because they are tax except within a regulatory framework. That however does not apply to software developers.

> Let me put this another way. If your friends give you money for your birthday, do you give it back to them and tell them you can't accept their gift because of tax and regulation?

Actual gifts are a different tax code (they are tax free). I can however not just pretend that any of my income is the same. This is not a "but if i read the law like this" thing.

> but if Austria makes it hard to accept cash gifts of small amounts then something is seriously wrong with Austrian law and this is not something to be defended.

From what I have heard it's not in any way easier in other countries and it does not have to be because that was never the problem. The whole point of bountysource and other systems is to accumulate money and to simplify the whole process. It makes everything easier, even if taxes would not be concerned. It's what makes the whole tipping thing save and easy through a middleman.

First let's get some perspective on the sums involved. One of the tip4commit spams I got after a commit informed me that my tip balance was 0.00000171 BTC. At current exchange rate this is equivalent in US dollars to $0.0005525523.

In other words, at a rate like that, it requires nearly two thousand tips just to add up to a single US dollar worth of tips.

And it gets worse. Remember that tip4commit "refunds" the tip back into the project pool if it's not claimed within 30 days. So just to get money out of this, you have to be making enough in tips, every 30 days, to overcome the cost in both time and potentially transaction fees of claiming the tips.

And then you have to do a bit more figuring to see if the money you'll get once cashed out is enough to justify the bookkeeping cost it imposes on you; after all, now that's income that you need to keep records of and figure into your taxes, which is not a zero-cost thing.

So first of all, you need to figure out the expected amount of tips, both over rolling 30-day periods and over the course of a year, which again is not a zero-cost thing, since if nothing else it involves spending time, and calculate whether they are enough to overcome the friction of getting the money out of tip4commit and then the cost of keeping records of and reporting it.

It is highly unlikely at this time that any person will be earning enough in tips from tip4commit to reach the point at which it becomes profitable even to the tune of a few units of local currency. A final data point for this: tip4commit states that it tips out at 1% of the balance of the project on each commit. Its attempt to tip me 0.00000171 BTC was for a commit on Django, which means the balance of donations for Django at that time was 0.000171 BTC, which simply cannot be enough to make it worth while for any person who contributes code to Django. And I don't rate it likely that there are a bunch of other projects with balances significantly larger, which means it is probable that there is currently no individual developer in the world for whom accepting tips from tip4commit is a profitable activity.

And that's without getting into the problems associated with the site displaying your name in tipping lists even if you never accept them, or the problems associated with displaying projects -- quite a few large open-source projects have associated non-profit foundations, and are bound by law regarding donations made for specific directed purposes. Although you can argue it's unlikely any person or organization would ever actually be punished based on tip4commit listing them, it certainly is possible that they could be called upon to prove that they are unaffiliated with tip4commit and refuse to accept the tips. Which, once again, is not zero-cost; now it potentially costs individuals and projects time and/or money for something they had no control over because tip4commit "opted" them in forcibly and continues to drag its feet on opt-out.

All in all, this is a mess. It probably should just shut down, but if it stays operating it's going to keep getting heat, and will keep deserving it, until it switches to being based only on explicit opt-in.

> Could you explain why accepting tips is so complicated? What specific law means you cannot do it?

I can't speak for the OP and the GP, but I can shed some light on this for which problems I could run into in germany:

* I own a company (GmbH, limited liability). Bookkeeping rules are fairly strict, I can't accept random money from random people without having an entry in a ledger. It's possible, but if it's single digits then it's probably more work than it's worth. I'd also have to figure out how to legally accept money from the US or whatever country this money comes from.

* I could accept the money as private person. Then I'd still have to keep books and add that to my private income. That probably would also be more work than the attached payoff.

* Not keeping books or declaring the donations may draw the scrutiny of the tax authorities. If you're accepting a lot of small cash gifts you might also run afoul of money laundering regulations.

> Let me put this another way. If your friends give you money for your birthday, do you give it back to them and tell them you can't accept their gift because of tax and regulation?

Gifts from friends and family are specifically exempt from income tax regulations, so you're attacking a strawman here.

Even supposing something was seriously wrong with Austrian law, it's a little presumptuous to expect everyone affected to try to fight that. Maybe they're already under careful watch by the national tax agency after getting audited because of some honest mistake the past year. Maybe they're under probation under a law you and I would call unjust, but triggering further law-enforcement attention lands them in jail regardless of whether they were justified. (This scenario happens a lot in America, incidentally.)

If someone says "I want to stay out of this", that should be their right.

Why would anybody bother figuring out the specifics to collect $50?

You are saying "take it and don't worry about it", but it's also not enough to take on any risk of hassle, let alone fines or whatever.