Budget and taxes

Revision as of 14:04, 13 January 2014

Our current tax system is unfair, inefficient, and so complex that it is opaque to virtually every taxpayer. The United Amendment establishes a single, simple, low tax rate without exemptions or deductions -- none. Every dollar a person receives is taxed at a very low rate; so low that most people don't believe it when they hear it. The rate is just 1/2 percent!

How can we fund the entire government on just 1/2 percent? It turns out that if every single tax loophole is closed -- all of them -- a rate of under one percent brings in as much revenue as the Treasury receives today. In the United States, there is about $1,100 trillion per year in transactions (give or take, it depends on how much of the settlement volume overlaps between the various payment/clearing systems). At 1/2 percent, that's $5.5 trillion, more than double what the Treasury currently receives in revenue each year.

Some of those transactions are short term, such as stock day-trading and flash-trading. Those types of transactions would likely no longer occur with a .5% tax. (In fact, many would argue that discouraging such trading will be beneficial since it will encourage long-term investing -- those short-term trades are considered parasitic by most investors.) Other short-term transactions involve short-term loans made between banks to comply with reserve requirements. Those would likely decrease under the new tax system also. However, because the rate is so low, many transactions that do not occur today because of high tax rates would become viable.

Also, with a very low rate, compliance in paying the tax will be much higher. Very few people will make efforts to try to avoid the tax or to cheat. Using cash transactions to cheat the tax would not be practical except for small transactions because for medium-sized transactions, the cost of counting and handling cash is larger than .5% and very large transactions are more detectable.

The system is much more efficient, transparent and fair:

• Everyone pays the same rate
• Almost everyone will pay less tax
• No more keeping track of receipts
• No more indecipherable forms to fill out
• No more intrusive and abusive IRS
• Provides certainty in tax policy for businesses
• Easy to understand for everyone

If you are paying more than 1/2 percent today in taxes, you will want to see this tax implemented.

Balanced budget

The United Amendment also includes provisions for a balanced budget. The politicians can't spend more money than the country receives in revenue. And when there the country is in debt, some of the revenue is used to pay down the debt.

But what about when there is an emergency, like a war? The problem with so-called "emergency exceptions" in law is that suddenly everything becomes an emergency to the politicians and they end up over-spending again on a regular basis. The United Amendment allows for debit spending in emergencies with one catch -- the Amendment says:

"No President, Representative, Senator, or Federal Reserve Governor may be elected, reelected, hired or appointed to any office or position within any public government or receive any benefit or payment, directly or indirectly from the United States or any State until all debts incurred or authorized during or subsequent to her term have been repaid."

If we really are in an emergency, then the politicians will have to decide if the consequences of the emergency outweigh the consequences of losing their jobs if the debt isn't repaid.

Transactions in the U.S.

Here is a table of transactions in the U.S.