[APT Project Director]

APT is a new, strikingly different concept in tax reform. It is thoroughly researched by an international economic expert who originally submitted it to a peer reviewed journal in 2000. The above article represents an update in calculations that essentially leaves the rates unchanged after a seven year interval. The APT Tax achieves all the reforms of the NST with none of NST's negatives. It achieves an extremely low rate by expanding the tax base from which it draws by 70 TIMES (not per cent). For huge transactions the tiny 0.24% gets lost in the bidding process. For small frys like us the total annual taxes paid for all Federal Tax including FICA is very little despite taxing (automatically) every transaction we make. At $2.50 per $1000 in transactions one needs $100K in income and after you save or spend it all, your total tax would be $500. If we could find an agreeable distribution formula, we could REPLACE all state taxes for an additional $0.50 per $1000. No more SS liquidity crisis. No more deficits. The national debt can be worked on with dispatch. The growth stimulated would do nothing but raise more revenue at the same rates. If this all sounds like science fiction -- it is NOT. Th finnacial data system of the 21st century allows us to consider it. ALL the details can be found at www.apttax.com.

APT deserves a seat at the "Tax reform table". Our country does not need to be sold down the NST river thinking it's the only way to end the IRS and the Code.

[ancient_geezer]

Where's your legislation's bill number so we can look under the hood at its practical implementation.

[endthematrix]

This, if I understand it, is similar to a floated UN proposal to fund itself. By taxing the transactions of the flow of international capital. I do not favor this as it is more centralized than the NST at the register.

[Eccl 10:2]

"The APT Tax achieves all the reforms of the NST with none of NST's negatives. "

It would seem to me that placing such a tax on financial transaction such as stock purchases and sales would quickly bring the financial markets to a grinding halt.

Investors would simply stop, and I mean STOP as in totally and quickly, trading securities on US stock exchanges. Capital formation would CEASE, and jobs would disappear QUICKLY as investment would halt.

Unless I'm missing something.

[Remember_Salamis]

I'm a big NRSTer myself, but if you're going to go as far as you're proposing, why not just do the following:

Repeal all federal taxes and simply print the money needed to run the government. Honestly, it would probably be better than the current system, which discourages saving, hard work, investment, and productivity gains.

Maybe we'll couple this with a massive tightening of the Fed. After all, so much money will be floating around the economy (no federal taxes) that savings rates will sky rocket and bank reserves will go up, suppressing interest rates while keeping inflation low.

Let's just call a spade a spade and implement a 3 - 5% tax on all national wealth through overt inflation (printing money).

3 - 5% on EVERYTHING! Now that's a Flat Tax!

[ancient_geezer]

Since all taxes and the overhead costs related to their compliance must of necessity pass either forward or back to the individual, how does the individual determine the total burden that the APT imposes upon his income and expenditures, including loss in capital value as a result of lower market liquidities; Overhead costs on business & financial markets as they pass on to the individual in impact on the economy; and deadweight losses involved in the burdens laid on transactions as an aggregate?

[endthematrix]

"The financial data system of the 21st century allows us to consider it."

That is a correct statement, but who or how many parties are in control of the data?

[Doctor Stochastic]

So the proposal is to have both a sales and income tax. What about prescription drugs for the poor? Are these still taxed?

[Fiddlstix]

BTTT

[ancient_geezer]

A Taxreform bump for you all.

If you would like to be added to this ping list let me know.

John Linder in the House & Saxby Chambliss Senate, offer a comprehensive bill to kill all income and payroll taxes outright, and provide a IRS free replacement in the form of a retail sales tax:

H.R.25, S.1493
A bill to promote freedom, fairness, and economic opportunity by repealing the income tax and other taxes, abolishing the Internal Revenue Service, and enacting a national retail sales tax to be administered primarily by the States.

Refer for additional information: http://www.fairtax.org, http://www.salestax.org & http://www.geocities.com/cmcofer/ftax.html

[jrfaug06]

A few years I had an idea to let banks deduct a small percentage say 1% from each transaction. Say you go cash a check. The bank will deduct 1% to give to government and you get the rest. Say you go to deposit 100 cash to your account. They will deduct 1% and give to the goverment. Every time a check of yours clears they will deduct 1%. When the company you paid for a debt deposits your payment they will get deducted 1%. Every time any one deposits or disburses 1% will be deducted.

Let's recongize that we have a closed system and use the banks to collect our taxes. They are already set up for it. Biggest plus will be it will hit the illegals sending money to Mexico or wherever.

John

[deaconjim]

No thank you. I prefer to keep my transactions private, and my cash available for use.

[jrfaug06]

Follow up example:

Say you take cash and go to buy beer. When that store deposits your money they will get hit with the 1%. This way cash gets taxed, not income. Cash is what we need to tax.

John

[staytrue]

It is a nice idea but I think what would happen is that a lot of stock and bond trading would move to an electronic exchange in the Caymen Islands or something like that.

Or it might move to Tokyo, Frankfurt, etc.

[Hank Rearden]

I've got an idea - cut the damn spending by about 45%! Too many parasites is the problem, not lack of money.

[zeugma]

This is an interesting propsal. I've seen this before, and it also dovetails nicely with the UN proposals to tax every single transaction in a similar manner.

The main reason I don't like it is that it is actually too transparent. People won't see the money coming out. I think the entire system of withholding that was mandated during the Nixon administration is one of the worse aspects of the current system. If you had to personally write that check each month, or at the end of the year, you'd be a lot more congnisant of exactly how much you are being raped by our masters in washington.

If this were implemented, people would become even more disconnected from the taxes they pay than they are now. I just can't believe this is a good idea. It is especially dangerous because the actual rate of taxation is so small. People just won't see the dangers when congresscritters propose the inevitable .5% per transaction increases. It would give the bastards yet another way to hide their rapacious ways.

[CindyDawg]

So each time you buy something you will have to show an account number to sort the tax? No thanks. The government doesn't need to know where I spend my money.

[c-five]

So if you buy a capital item like a building or a locomotive or even an automobile, that is built up of many components and subassemlies, minor and major, fabricated by various providers (or divisions?) you pay transaction tax on every bolt, brick, wire or semiconductor, the labor to make it, the payroll contractor of each provider, etc. and the labor to make them into, say, an alternator. Then you pay a transaction tax on each part, unit of labor, and subcontracted service again, when an assembler acquires the alternator and puts it on an engine. Then you pay a tax on all of that again, when you ship the engine to a final assember to make a vehicle. So now you've paid a tax on every bolt at least three times, plus a tax on the tax and a tax on the tax on the tax assessed on the original component. Voila, 0.24% turns out to be the same big bucks we pay now. It's all just hidden from view. The legislature can raise taxes anytime it wants, and no one notices. Just the price of every good and service goes up. No accountability. Sweet.

[Sarastro]

First: your handle sounds like you're connected with this project, and you just signed up the day you posted this. Shilling for your "product" on Free Republic -- if that's what you're doing -- is unseemly.

Second: the idea is crackpot.

A transaction tax would create friction in the mobility of capital, thus adversely affecting the long-term efficiency of our economy, which depends strongly on moving capital to the highest and best opportunities.

Also, transactions -- thus this proposed tax -- could be avoided by corporate mergers. This would create artificial incentives for vertical integration and reduce incentives to outsource, thus further reducing economic efficiency.

You admit this in your premise when you assume a 50% reduction in transactions. This would be disastrous to our economy.

[dpwiener]

This is a terrible idea. Transactions of all kinds should be as frictionless as possible to quickly eliminate distortions and to disseminate the information provided by the "invisible hand" of a free market economy. This would do just the opposite, by generating a totally new set of distortions, reducing liquidity, and creating other unanticipated and unintended consequences.

Of course our existing taxes also cause similar problems, but there's no reason to expect that this proposal will solve more problems than it creates. And that's even if the proposal were adopted exactly as stated, eliminating other taxes in the process. The much more likely scenario is that this would merely be added on to the existing tax structure, and would at best only temporarily reduce (but not totally get rid of) other taxes.

And the idea that the transaction fee would be so small as to not be a major burden is laughable. It might start out with that intention (just as the income tax started out as a very small percentage) but it would grow inexorably over time.

There is no good solution to taxation except to continually reduce the total tax burden along with the size and power of government. Anything else is just rearranging deck chairs on the Titanic in an attempt to counterbalance the flooding.

[flashbunny]

If it comes from UW madison, it's crap.