Wednesday, March 7, 2012

One tax system society

One tax system society. Value added tax at the retail end. Tax that is not hidden but is clearly shown on the sticker price. It would allow every member of society to know how much of his/her money they contributes to the system. Easy to understand transparency is a key to a successful modern society. Gives us a better informed voter, and thus a more efficient government.Manufactures and service providers would have a huge advantage with such a tax system. Every competing foreign product would carry to the cash register all of the country of origin’s tax system. And both products and services would carry the added value tax. That would make the domestic products far cheaper at home, and the same in foreign markets.Taxes create corruption. It is human nature at work. Limiting the taxes to the retail end would allow society to become more honest over time. Only these people (owners of retail businesses) would be a class susceptible to cheating the government. Consequently, It would allow the system to focus on less potential cheaters. And thus be more efficient.With a tax-less industrial chain system we will have far less expenses on compliance in the production chain. It would also channel money to the most productive places rather than the once that produce the best tax position. It will make the country an inviting environment for foreign investors to build production lines for world-wide distribution It would also make it comfortable for local companies to repatriate (bring back) money earned abroad back into the local economy, because there is no cost attached to it.An exclusively added value tax system would force lawyers, accountants and some others to lose their place in the system as it is now. But with the influx of foreign companies over time they will gain back theses jobs and more in a more productive way. Not heavy on the existing production line, but rather extracting their share from the influx from the outside world.The Rich would pay the most in such a system. because they consume the most. Government can have different levels of added value tax on different classes of products and services. But it is very important that it is on all products no exceptions. Every voter must feel the pain of government cost. otherwise it is easy to be convinced tovote for people that call for spening money. It comes from someone else’s pocket.Every Penny that a rich man or a business earns and keeps goes either to the company stock holders, or for reinvestment. If that money is invested farther, the value to society is clear. It creates jobs. When the money goes to the stock holders they either spend it and thus pay the consumption tax, or they invest it themselves. Same difference, it creates JOBS and new products.One last point. Money owned by a rich man serves many. His name is on the money and he gets financial value from it. But that money is also the work place of the people he employs. They ride in the same car. In a different seat but in the car.

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