If you had to design a brand new tax system for a new country, would you use a developed country tax system as scaffolding?
I think a simpler and fully transparent system can be achieved by removing all taxation from every business and putting a single tax on final products and services consumed by end users. That way, we will all know exactly how much tax the government takes.
- income tax
- payroll tax (employer contributions)
- property tax
- capital gains (buy a house, sell 20 years later, pay taxes)
- corporate tax
- council tax
- state level tax
- inflation
- VAT
When you look at how much is taken at each step, the final amount from your work taken in taxes is in the 70% to 85% range. This could be greatly simplified by translating all those taxes into a final tax on products and services consumed.
1L of milk:
20% price
80% tax
a car:
15% price
85% tax
No taxes on your income, no taxes on companies, no taxes on anything other than the final products and services consumed. The government can provide direct monthly payments to people with lower incomes. If you want to make sure that no one runs out of milk and bread, the tax can be set to zero, making those goods extremely cheap.
This is a fully transparent system that makes it hard to increase taxes in shady ways.
I think a simpler and fully transparent system can be achieved by removing all taxation from every business and putting a single tax on final products and services consumed by end users. That way, we will all know exactly how much tax the government takes.
- income tax - payroll tax (employer contributions) - property tax - capital gains (buy a house, sell 20 years later, pay taxes) - corporate tax - council tax - state level tax - inflation - VAT
When you look at how much is taken at each step, the final amount from your work taken in taxes is in the 70% to 85% range. This could be greatly simplified by translating all those taxes into a final tax on products and services consumed.
1L of milk: 20% price 80% tax
a car: 15% price 85% tax
No taxes on your income, no taxes on companies, no taxes on anything other than the final products and services consumed. The government can provide direct monthly payments to people with lower incomes. If you want to make sure that no one runs out of milk and bread, the tax can be set to zero, making those goods extremely cheap.
This is a fully transparent system that makes it hard to increase taxes in shady ways.