Now that I found an organization that is built on the
concept of a transactional tax, do I drop The CUT Tax idea and maybe join up
with the APT tax movement or continue on?
Even though they are built on the same premise. There are
differences between the APT and my vision of a transactional tax.
- · The APT covers all electronic transactions, while The CUT Tax only targets transactions that could be considered gross revenue.
- · The APT will be harder to institute exemptions and progressive rates, while the CUT Tax does allow for manipulation with the exclusion list and possible future limits to minimums until the Tax is triggered.
- · The APT splits the transaction fee between the sender and receiver, while the CUT Tax only focuses on the receiver.
- · The lower rates proposed by the APT tax does desensitize the general population to increases in rates. While the higher rate of the CUT Tax does add a sting to rate increases to everyone.
- · The APT is highly researched and proposed by a credible Economist, while the CUT Tax is a logical progression thought up by an unaccredited individual.
- · The APT has been used by wealth redistributionist to create a platform for wealth redistribution, while the Fair Tax has been used by the wealthy to create a platform of wealth protection.
There are many issues to consider while I make this decision.
However for now I will only concentrate on the six listed above.
The first issue of covering all transactions equally. I do
see a problem with this issue because it creates a new tax on lateral
transactions. Many individuals and companies have multiple accounts to
diversify their risks. An individual or business may separate their accounts to
create safe guards from fraud or identity theft.
In the case of an individual they may create three or more
accounts to insulate themselves from the prospect of identity theft, where all
of their money is not taken over night by a thief that compromises one of the
accounts. This is just common sense. You do not keep all your money in one
place in case something happens, you always want backup or a safety net in an
emergency. Although you may have these funds restored, you will want unaffected
reserves to use until the issue is rectified.
With a business the concerns may be the same. Most
businesses will establish multiple account to better track and identify cash
flow. They usually separate payroll from general business accounts, and may
further divide accounts into sections and fund from a detailed budget to better
track progress. The APT would tax any lateral movement of funds, where the CUT
Tax would allow for the transfer of funds between accounts without triggering a
fee.
On the fact that the APT is harder to manipulate, I will
give them that point. In my perceived need to differentiate between types of
transactions, I have created possible avenue for politicians to justify
exemptions. I even given them one with the exclusion of Social Security
payments as being exempted. This I have done just for practical purposes, and
in general SS benefits have been considered tax exempt.
Points three, four and six are connected. Although,
splitting the fee between the transaction does make logical sense, it also
creates a tax that can seams disconnected from reality. If I say I was going to
raise your tax from thirty five cents per hundred dollars to fifty cents per
hundred in order to expand government, you may say why not, I am not losing
that much. Many people will not be able to grasp the end effects of raising the
tax rate this much. They may not have the time or the desire to look at the
downstream effects of this form of taxation. Although it seems like a minuscule
amount of money, the downstream consequence are very high.
That is the reason I do like my form of taxation. It does
have a small bite, but it is not inconsequential to the average person. And
changes in the system will have to be closer to 25 basis points to make a large
impact to the budget, instead of the 5 basis points adding significant revenue
in the APT model.
That is why the main opposition to form of tax and the Fair
Tax are so politically divided. There is a faction within the APT school of
thought that want to use this as a way to increase federal spending. Just as
there are factions within the Fair Tax that want a high end user tax to create
pressure to reduce governmental spending, and to protect the wealth they have
generated.
On the fifth point about credibility. I am just a middle
class individual with no accreditation. I tend to have a contrarian view of all
plans. At this point in time I only see three alternatives to the tax code
issue. One reform the tax code to something reasonable, two the replacement of
the tax code with either a fair tax or a transactional tax. At this point I
like a transactional tax. My transactional tax.
