What it takes for commutalism to become reality

Without verified identity, it is impossible to reliably link an income to a transaction. The eIDAS 2.0 Regulation, adopted in 2024, mandates the creation of the European Digital Identity Wallet (EUDIW) for every Member State by 2026. This wallet will store verified attestations: employment status, income bracket, regional residence.

Why this is essential. The EUDIW wallet is the entry point of the entire commutalist architecture: it authenticates the buyer and delivers proof of income to the merchant, without the latter accessing raw sensitive data.

The digital euro — Central Bank Digital Currency (CBDC) — is the digital version of the euro issued directly by the European Central Bank. Unlike classic bank payments, it is programmable: a transaction can carry structured metadata, including, with user consent, an income index attestation. The ECB completed its investigation phase in October 2023 and launched the preparation phase, aiming for a legislative decision in 2025.

Why this is decisive. The digital euro is the only payment vector that allows a price adjustment to be applied at source, without a banking intermediary seeing income data. It transforms the transaction into an encrypted bilateral contract. No existing payment technology offers this property.

The most legitimate concern about commutalism is this: why would a merchant know my income? Zero-Knowledge Proofs (ZKPs) answer this question definitively. This cryptographic technology allows a user to prove that an assertion is true — "my income is in the €3,000–5,000/month bracket" — without revealing any additional information. The merchant receives only the calculated index (e.g. 1.139), never the income.

Why this is non-negotiable. Without ZKP, commutalism exposes individual incomes at every transaction — a flagrant privacy violation. With ZKP, the system is more privacy-respecting than the current bank card, which exposes the complete spending history to the bank.

The PSD2 directive (2018) opened banking data to third parties with the account holder's consent. This revolution created the fintech Open Banking sector in Europe. Commutalism needs an equivalent advance on the fiscal side: secure, consented and standardised access to income data held by national tax administrations. Let us call it Open Fiscal — the next frontier of European Open Data.

Why now. The 2023 Data Act established the principle. PSD3 extends Open Banking. The moment is ideal to include fiscal data in this consented openness movement, with rigorous controls on authorised uses.

Directive 2011/83/EU on consumer rights requires clear pre-contractual information on price. It does not prohibit differentiated pricing, but it does not provide an explicit framework for retail either. Income-based pricing already exists legally in entire sectors: insurance (actuarial), credit (scoring), streaming platforms (student rates), Airbnb (dynamic pricing). Commutalism generalises this principle with transparency and a public formula.

The argument. A consumer who knows their price is calculated from a public, verifiable formula is better protected than a consumer subject to opaque dynamic pricing by Amazon or airlines. Commutalism makes visible what today remains implicit.

Article 101 TFEU prohibits agreements between companies that distort competition. If several merchants adopt the same pricing formula, this could be interpreted as price coordination — which is precisely what antitrust law combats. This objection is serious and must be addressed head-on, as it would constitute the most immediate legal obstacle to widespread adoption.

The central argument. Commutalism does not coordinate prices — it coordinates the progressivity of margins according to a public reference. Base prices remain completely free. A more affluent pays more for the same baguette at one store than another if base prices differ. Competition is intact.

The GDPR (EU Regulation 2016/679) is the world's most advanced regulatory infrastructure for personal data protection. Income data, although not classified as a "special category" strictly speaking, is highly sensitive financial data. Its use in a pricing context requires precise rules on minimisation, retention, and individual control.

Europe, world champion. GDPR has already made Europe credible on data protection. A commutalist GDPR framework would reinforce this position, showing that Europe can innovate economically and protect its citizens, where other personalised pricing models (American big data, Chinese social credit) sacrifice privacy for efficiency.

Directive 2000/43/EC prohibits discrimination based on racial or ethnic origin, particularly in access to goods and services. Income level is not a protected criterion under EU law — but in countries with a strong income/origin correlation (which is the case in most Member States), income-based pricing could produce indirectly discriminatory effects. This risk must be anticipated and neutralised.

The positive argument. Without commutalism, a minimum-wage household and a senior executive pay the same price for the same good — creating a structural access inequality. Commutalism reduces the access gap. By construction, it is the most anti-discriminatory pricing policy that exists.

The commutalist formula relies on the regional median income as a neutral reference. This data must be reliable, recent, comparable across regions and Member States, and updated frequently enough to reflect the real evolution of incomes. Currently, Eurostat publishes SILC (Statistics on Income and Living Conditions) data with a lag of 18 to 24 months — insufficient for real-time application.

A credibility issue. A median that is two years out of date in a rapidly changing area (urban gentrification, deindustrialisation) will produce visible injustices. The statistical quality of reference data is the perceived quality of the entire system.

Who decides that a smartphone is an "everyday good" (luxury factor 0.50) rather than a "semi-luxury" (0.60)? Who revises these parameters when the nature of a good evolves? Who checks that merchants correctly apply the formula? These questions call for an independent, transparent and democratically accountable regulatory body — modelled on the European Banking Authority (EBA) or the European Data Protection Board (EDPB).

Without governance, no trust. The legitimacy of a differentiated pricing system rests entirely on trust in the parameters. Open, audited and contestable governance is the sine qua non condition of social acceptance.

Just as ISO 20022 standardises interbank payment messages, commutalism needs an open standard defining the calculation formula, the format of income attestations, and the query API between wallet and point of sale. Without a standard, each major chain will develop its own interpretation — leading to fragmentation, disputes and loss of comparability between merchants.

Europe of standards. The European Union has a strong tradition of technical standardisation (ETSI, CEN). Imposing a European commutalist standard before private actors create proprietary silos is a matter of digital economic sovereignty.

No economic system deploys by decree. The transition to commutalism must be gradual, voluntary at first, and rely on tangible incentives for pioneering merchants. History shows that systemic innovations — from the Organic label to e-invoicing — succeed when they start with the most receptive sectors, generate social proof, then spread through emulation and finally regulation.

The e-invoicing precedent. E-invoicing took 20 years to go from voluntary experimentation (2003) to generalised obligation (2024 in France). This delay is normal for a systemic transformation. Commutalism can move faster because the underlying technologies (wallet, digital euro) are being deployed simultaneously. It is a convergence, not a revolution.

The commutalist formula calculates the index on the declared buyer's income. This creates a critical edge case: if a person receiving RSA (€350/month) makes a purchase on behalf of a multi-billionaire — a yacht, a luxury car, a property — they automatically benefit from a massive reduction, even though the good will be owned and used by a very high-income individual. Third-party purchasing can become a vector for systematic circumvention of the progressivity mechanism.

Conversely, prohibiting all third-party purchases would be disproportionate: gifts between family members, family purchases, legitimate commissions between an employee and employer are normal economic practices that must not be blocked.

The principle of economic reality. Commutalism applies to the real economic beneficiary of the good, not the administrative intermediary of the transaction. This is the same logic as international tax law for holding structures: one traces back to the natural person who actually benefits from the value. The final beneficiary declaration protocol makes this principle operational without banning legitimate third-party purchases or creating bureaucracy for small amounts.

A pricing system based on declared income is structurally vulnerable to several circumvention vectors that go well beyond simple third-party purchasing (prerequisite no. 13). These vectors can be individual, organised or systemic, and each calls for a distinct technical and legal response.

The principle of economic equivalence. The commutalist formula calculates an index on real financial capacity, not on the legal or administrative form of the transaction. Any circumvention that dissociates the formal buyer from the real economic beneficiary creates an asymmetry that the system must be able to detect and correct without criminalising legitimate uses or creating bureaucracy for everyday purchases.

The commutalist formula calculates the relative wealth ratio in relation to the regional median. This choice creates a counterintuitive but mathematically coherent effect: in a region with a low median, a high-income buyer sees their ratio increase (they are relatively wealthier locally) and therefore pays a higher price than if they made the same purchase in a wealthy region. Conversely, a modest buyer in a poor region is proportionally less far from the local median than they would be in a wealthy region, and therefore benefits from a smaller reduction.

This mechanism, if uncompensated, generates two major economic risks:

The principle of territorial accessibility. Commutalism must not reproduce in a new form the territorial inequality it seeks to reduce. Territorial equalisation is to commutalism what solidarity grants are to local taxation: a corrective mechanism that preserves incentives while preventing the least favoured territories from being doubly penalised — first by low incomes, then by an impoverishment of their commercial offer.

The visa is the natural insertion point for an income declaration for non-EU visitors. The Schengen form already requires proof of financial means (Art. 14 Visa Code, ~€100/day of stay). This prerequisite proposes extending this obligation to a structured two-part declaration — PPP-adjusted net monthly income and net wealth — from which a commutalism index credential is derived. This credential is the only data transmitted to merchants; the gross income never leaves it.

Without this prerequisite, non-Eurozone visitors systematically pay the base price (index = 1.0) — no reduction for modest incomes, no surcharge for very high incomes. Commutalism's fairness would stop at the Eurozone border for anyone not residing there.

An index derived from a visa declaration must never circulate as raw income. Three complementary protection layers guarantee this confidentiality. (1) TEE Enclave: gross income is processed in a Trusted Execution Environment (Intel SGX / AMD SEV) at the embassy; the enclave computes the index, issues the signed credential, destroys the raw income. (2) VC + BBS+: the credential contains only the index and expiry; each checkout presentation is a single-use proof (BBS+ unlinkable) — two distinct purchases cannot be correlated. (3) Optional ZKP: for maximum privacy, the visitor proves their index is in band [a, b] via a Bulletproof, without revealing the exact value.

If merchants or checkout systems had access to customers' raw income, commutalism would create pervasive financial surveillance incompatible with the GDPR and fundamental freedoms. Anonymisation via TEE + VC + ZKP is the technical condition for the system's social acceptability.

The central mechanism of commutalism — the automatic application of the income coefficient to every transaction — can only work if payments flow through a channel that carries the payer's EUDIW attestation. Fiduciary money (banknotes and coins) is by nature anonymous and non-programmable: it bypasses this mechanism. Any cash transaction escapes the coefficient and constitutes a residual grey-market vector. The generalisation of scriptural money — and ultimately of the digital euro (CBDC) — is therefore a structural condition for the system's full effectiveness.

This prerequisite does not assume the total abolition of cash. It only requires that commutalist transactions — those benefiting from an income-adjusted price — must go through a verifiable scriptural channel. A buyer who prefers to pay cash simply pays the base price, without adjustment. The constraint is not on the freedom to pay, but on access to the commutalist rate: that rate is a benefit conditional on using the channel that makes the coefficient verifiable.

→ See Flaw A in Objections