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An interesting idea for changing taxes March 12, 2007

Posted by Al in : clever,interesting , trackback

There’s not a lot about tax that is really interesting – we all know that taxes are required to pay for out government (although we may not all agree on whether we get any value for money in this respect), and we all know that we have to pay taxes or risk the government getting upset. However I doubt whether there is anyone who is happy to pay taxes, and there are always some taxes which are less popular than others.

So what would happen if a single uncomplicated tax, which has no exceptions or exemptions and is tiny in comparison to current taxes, where to be put in place instead? This tax would be levied against all payments and transactions so that corporations and financial institutions would be taxed at the same rate as individuals, and yet such a tax could raise the same amount of money as current taxes. Sounds like a great idea to me. Admittedly people might consider moving to a more cash based economy, but when the tax rate is as low as only 0.3% of the transaction then a lot of people would just shrug and continue as normal. The only people who would raise a fuss about such a tax would be the stock market – however if more countries of the world started to impose such a tax then they would just have to shoulder the burden of losing 0.3% – this might even have the advantage of preventing short term day trading and so lead to a slightly more stable economy. I can’t really see any downsides to this idea and I would certainly vote for anyone who proposed such a tax in the UK.


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