Questions & Answers
Is there any way to test the New Hamilton Tax Plan?
Yes, the President could use an executive order to implement the technical framework and impose a very nominal transaction fee to pay down the National Debt.
What About The Underground Economy?
These people are not paying income taxes now; but under the plan, they will pay every time they deposit or cash a check, convert currency, buy a money order, pay for a pre-paid credit or phone card, etc. The foreign workers who send money home will also be paying. They will be paying the “Base Percent” and possibly one or more surcharges for transferring funds to another country.
Who Pays More The Rich, The Poor, Or The Corporations?
The people who use U.S. Financial System the most will pay the most. In descending order of total dollars paid, they are:
Multi-national Conglomerates and Billionaires
Large Corporations and Millionaires
Small businesses and the well-off
Sole proprietorships and The middle class
What Happens To The IRS?
The IRS will switch from randomly monitoring and auditing hundreds of millions of individuals and corporations to closely monitoring and auditing tens of thousands of financial institutions.
What Happens To the “Tax Industry”?
Most of the companies within the industry will evolve and adapt, they will still have state and local taxes to prepare and contest; all will take a financial hit, and some will call it quits. You can rest assured that the entire industry filled with lawyers and accountants will raise a thunderous protest and a political firestorm, but the welfare of the many must be put before the greed of the few.
What Happens with U.S. Government Transactions?
All funds that flow in or out the U.S. Financial System are subject to the “Transaction Fee”. It may seem strange for the Federal Government to take money from its right pocket and put into its left pocket, but it makes sense, if there are no exceptions to the fees for using the U.S. Financial System.
What Happens with State & Local Government Transactions?
If Workers & Profitable Businesses Pay Less, Who Makes Up The Difference?
When the Federal Income Tax system is replaced by a Financial Transaction Fee system, more revenue will be generated and the costs for using the system will be spread fairly across all of the system’s users. The companies, organizations and individuals who are now exempt from income taxes, will have to pay transactions fees; however, they will also be free of the severe restrictions placed upon them to maintain their ”tax-free” status; free to use their considerable assets for their own cause.
Contributions to private retirement accounts are exempt from income taxes, as are their investment profits. The retirement assets in 2015 totaled roughly $25 trillion. The individual accounts will be charged transaction fees. This will limit hedge fund managers who trade on fractions of a penny profits. It will also limit some of the speculative trading by retirement account managers.
Corporations and individuals evade trillions of dollars in income taxes by using income exemptions and tax deductions. For instance:
Corporations may be formed, acquired, merged, reorganized and liquidated in nontaxable ways. Now they will have to pay transfer transaction fees.
Depreciation rules, special tax deductions, deferred income, and paper losses are but a few of the legal ways to evade income taxes. Income tax deductions and loopholes are meaningless if there aren’t any income taxes.
Assets transferred, to or from, and between trust and foundation accounts will pay transactions fees.
People, corporations and organizations who lose, make, or break-even on security trades will pay transaction fees
Inter & Intra-bank transfers will pay transaction fees
Inter & Intra-company transfers will pay transaction fees
Moving money from savings to checking or visa-versa will pay transaction fees (the smart banks will offer merged accounts).
Assets transferred into or out of the country will pay transaction fees and possibly surcharge fees
Are there any loopholes?
Not if there aren’t any exceptions
What happens to the Tax Exempt Bond Market?
Qualification for a Federal exemption would be meaningless; however, State and local exemptions would still apply.
Is there competition from other financial systems?
Not from bit coin; their transaction fees average 3%-4% (20 times the proposed US rate). Not from the offshore tax havens; they have income tax & other fees varying from 12%-25%. However there is nothing stopping other countries from implementing similar systems.
What about Asset Transfers that by-pass The U.S. Financial System?
(Asset $Value is the greater of Purchase Price or appraised value)
Asset Pay Transaction Fee when
Real Estate Title changes
Registered Personal Property Registration changes
Other Personal Property Insured