Chapter 11. Fiscal strategy.
- This chapter's goals.
- A unique tax to establish a social solidarity monetary hoard.
- Collection advantages.
- Advantages for taxpayers.
- Progressive tax on consumption, much easier than vat.
- Transient fiscal policy.
1. This chapter's goals.
In the previous chapter we have described
a strategy for the balance of the domestic market, on the basis of the
communal invention of money according to investment and consumption production
surpluses. We have called them mercantile common goods.
This strategy allows not only a market equilibrium, but also the quantification
of the communal money hoard (credits and finances) which will be
used to cover the government expenditure, to finance all those activities
that the geo-political society takes up as its own and not of private enterprise
(we called them public services).
Putting aside the invention of money -which all moden states bring about
through their national banks-, the other classical system to establish
a communal money hoard is that of fiscality.
During the starting period necessary to find out if the rational strategy
of political invention of communal money is enough for the communal needs
of the geo-political society, an extreme strategic market prudence must
be shown. For this reason, and in order to overcome any possible experimental
invalidation of the hypothesis or actual lack of investment and consumption
production surpluses, law can foresee having recourse to fiscality.
Cheque-invoices, which allow a rational strategy for invention of money,
can also become the instrument of a drastic fiscal simplification and rationalization,
as we will try to demonstrate in this chapter.
2. A unique tax to establish a social solidarity monetary
Present day tax systems are frightfully complicated for the tax-payer
and very expensive for the several collecting bodies, because of the great
number of employees necessary for the collection and control.
This situation can be easily overcome through the cheque-invoice, which
allows the application of a unique tax, by fixing a legal percentage on
each of the cheque-invoices produced by the geo-political society, to be
paid always by the customer.
This system allows a great simplification: there is a unique tax, the
same for everybody, which is paid according to the expense made; there
is one only controlling body: the geo-political society; and collection
is automatibc, since every produced cheque-invoice implies automatic payment
of tax, which eliminates all sorts of collecting bureaucracy.
The monetary hoard obtained through this only tax will be equitably
distributed to the credit-investing sector and to the consumer-financial
sector, according to the different statutes we will consider in next
3. Collection advantages.
The two main advantages for the simplification of tax collection are
Automatic and simple calculation: we must only know the legal percentage
on the total of each cheque-invoice. There is no discussion with tax collectors.
This enormously reduces collecting costs, as all specialized bodies disappear.
Automatic collection: the legal percentage must be compulsorily indicated
in each cheque-invoice, so that it will be automatically paid with it.
The control that this condition is being fulfilled is effected by the telematic
network, which makes deceit or fiscal fraud almost impossible. Finally,
the accounting firms can discount from every invoice they handle the indicated
percentage and transfer it directly to the treasury's current account.
For this service accounting firms will receive a commission agreed upon
by the association and the monetary authorities. This would be the only
expense produced by the collection of the unique tax1.
4. Advantages for taxpayers.
The main advantage of a unique tax as suggested, from the point of view
of taxpayers, is that it makes much easier the respect of fiscal obligations.
Consumers will have no further worry concerning taxes, as each signed cheque-invoice
implies automatic payment of the corresponding tax percentage.
On the other hand, businessmen will be able to calculate in advance
for every accounting year the whole of taxes to be paid on their purchases
of rough materials, equipment goods or production factors (work, capital,
staff, invention) and therefore will be in a position to apply this expense
to cost prices.
Of course workers, as production agents, will pay no tax: it is the
company who buys their work and therefore, being a customer, pays the corresponding
tax. Workers will only pay taxes as customers-consumers.
Probably this tax will be much cheaper for the taxpayer than the whole
of the many taxes he now pays.
The percentage will not be very high, if we consider that every
cheque-invoice implies payment of a tax and eliminates therefore present
day fiscal fraud. The compulsory cheque-invoice avoids at the root, as
it can easily be understood, all underground economy: therefore the tax
amount will be directly proportional to the actual total volume of the
market of the geo-political society.
5. Progressive tax on consumption, much easier than
As we have explained in the previous paragraph, the unique social
solidarity tax is proportional to the actual volume of purchase indicated
in every cheque-invoice. It is therefore progressive for those who buy
more and, especially, in the consumption area: consumers spending more
pay a higher amount than consumers spending less2.
The advante of the social solidarity unique tax with respect to the
value added tax (vat) is that the first one does not admit interpretations
of fiscal law nor discussions on its application, while all the laws concerning
vat can be interpreted and discussed, which means the existence of a bureaucracy
to take up a job of inspection and arbitration.
With respect to equity between the two different taxes, it must be said
that in both cases it is the customer and market in general who pay, not
the company. But because of the possibility of interpretation in the application
of vat, larger companies are in a better position to discuss and complicate
its application, and, as a consequence, to have more advantages than ordinary
companies: these are the only ones to have an interest in the free and
responsible market we are suggesting.
The money amount collected through the unique social solidarity tax
is in the end redistributed as finances and credits.
6. Transient fiscal policy.
The unique tax to obtain the social solidarity monetary hoard implies
the suppression of all other taxes (state, regions, boroughs...). It will
only be fixed, maintained and perhaps increased, reduced, suppressed or
fixed again, if political convenience makes it necessary, as it has been
indicated at the beginning of this chapter, or if the omniaccounting, statistically
exact, of all the geo-political society demonstrates that, in practice,
the political invention of solvent communal money, with respect to actual
production surpluses, is not enough for the chosen democratic economical
Political convenience suggests to «protect» the hypothesis
of mercantile common good as investment-credit production surpluses and
consumption-financial production through:
A simple and effective tax system;
Socialization of daily positive balances of free current accounts at sight.
If the hypothesis of common good is experimentally confirmed, in practice
it will be possible to reduce a percentage of tax on the amount of every
system must be studied to avoid unfair competition of vertical companies
-made out of several specialized production sections for the same final
product- with respect to horizontal companies much more specialized and
clients to each other, a competition caused by the fact that the first
ones will have lower tax burdens than the others.
accumulation of successive taxes which weighs down on final price:
has no importance on the domestic market, as the suggested system foresees
an equitable distribution of gnp.
with respect to foreign trade, it is very easy, should it be necessary,
to credit the corresponding amount in case of an excessive fiscal cost.