As the Democratically controlled house and Senate root around for new methods of raising revenue without violating the Presidents promise not to raise taxes on the middle class, they have begun to visit the European idea of a Value Added Tax (VAT). The VAT is a tax, much like a national sales tax on each point in the manufacturing and sales process. In theory, this tax makes some sense if it replaces the national and state income taxes and current state sales taxes. Unfortunately, the house and senate are proposing to add the VAT as an additional tax. This will truly cripple business, industry and the pocketbooks of all Americans, middle class included.
Fortunately, there is an alternative. This alternative is easy to incorporate nationally, eliminates the avoidance of taxes by the underground economy and actually puts more money into the pockets of business, industry and all American citizens. This tax will also encourage saving rather than spending.
An additional benefit would be the automatic payment of taxes at the point of sale, so there will be no need to file a tax return. America would therefore eliminate the need for the IRS and potentially save more than 100 Billion annually.
Fortunately, there is an alternative. This alternative is easy to incorporate nationally, eliminates the avoidance of taxes by the underground economy and actually puts more money into the pockets of business, industry and all American citizens. This tax will also encourage saving rather than spending.
An additional benefit would be the automatic payment of taxes at the point of sale, so there will be no need to file a tax return. America would therefore eliminate the need for the IRS and potentially save more than 100 Billion annually.
What is this wonderful tax? How is such a thing possible? The tax is the Automatic Payment transaction Tax (APT tax) and it can be incorporated into the economy with equipment already in operation across the width and breadth of the country.
The APTT (http://www.apttax.com/) is a small, uniform tax on all economic transactions which replaces the personal income tax, the corporate income tax, the state income tax, capital gains taxes, gift taxes, estate taxes, excise taxes and sales taxes. The APT approach would extend the tax base from income, consumption and wealth to all transactions. Such a uniform tax might not, on its face, look progressive, but would be since the volume of taxed transactions rise disproportionately with personal income.
Most importantly, the APTT takes away from our legislators the one thing that the legislators appreciate the most and the average American appreciates the least -- Governments ability to use the tax code to manipulate public policy. By instituting the APTT, our legislators will no longer be able to use the tax code as a weapon to punish segments of business and industry and direct investment from one type of business to another. Every area of the operation of the American economy will operate on an even playing field.
The APT tax is designed to avoid the contentious issue of how large the government should be by conceiving it as a revenue neutral tax that would replace other taxes. Simplicity is achieved by requiring that all final party transactions be taxed, and at the same rate. The APT tax .can be viewed as a public brokerage fee accessed by the government to pay for the provision of the monetary, legal and political institutions that protect private property rights and facilitate market trade and commerce.
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