In defense of Gross Reciepts Taxation

    The Cut Tax (currency use tax) is based on a known tax structure called a Gross receipts tax. Many economist call this tax indefensible. This was the case from an article I have read on the Economist web site by Andrew Chamberlain.  The Economist case against gross receipts taxes.  (http://taxfoundation.org/blog/economists-case-against-gross-receipts-taxes.

    I was well aware of the tax pyramid effect when I wrote this form of taxation. I contend that all forms of taxation lead to tax pyramiding. Therefore, if the business is able to deduct the cost of acquisition off of the final sale price. That did not magically make any imbedded tax go away, It just turned that tax into an expense that was added to the sale of the finished item. Then in turn that producer will try to price the finished item to receive their after tax profit margin desired. Therefore, if the item goes through another process. This magical cycle is repeated. Thus, a renamed tax pyramid, can be called the expense pyramid. To deny this, is to call the most common denominator, the laborer ignorant of their own tax liability. I will contend that many do not consciously operate on the awareness of their tax liability. However, they do know how much they need and want to do the labor. This intellectually ignorant argument is just a gimmick  to hide the true tax on the middle class by trying to shield corporations from taxes. Being a middle class hourly employee, I can not  manipulate my books or offset income to shield my profits from taxation. I am stuck paying three or more times the average tax efficiency base. I establish this by a simple equation. Divide GDP 65.978 T(trillion) into Gross tax receipts. 2.45 T and you get .0377. That means the average tax cost on all currency is under four cents per dollar. In the income tax system, being lower middle class my tax rate should be close to 3.8%. It isn’t. I also understand businesses don't pay taxes they just collect them.

Therefore, I would be happy to pay a low overall rate on gross earnings, in exchange for the over inflated retail price you say this form of taxation will create. The only problems I see with GRT is enforcement issues and exclusionary manipulations. I do not wish to stick it to the rich or companies, I just want a tax where the burden is shared equally. In a team of horses, the strongest horse does not expend more effort, it just produces more work for the same amount of effort. This may not be fair it is just a fact.