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Sterkarm

The Honorable Judge Mental
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There was no compromise at all about that. President Josephus simply changed his mind on the issue of the defense budget, something I was glad to hear. No compromise was made that I know of. Perhaps there were some backroom deals were made, but I had absolutely nothing to do with them, and therefore I am not binded to them. I do not attach myself to my party or my coalition so strongly that I follow whatever they decide, I do my best for the future of Eutopia. That is why I oppose this monstrosity that you've somehow come to call a VAT.
 

unmerged(37832)

Corporal
Jan 12, 2005
27
0
Do you know what a percentage means, or is it just capitalist nonsense to you, Mr. Dank? It means that you pay a certain amount proportional to your income. Therefore, if you pay 25% income tax and have an annual income of 40,000, you will pay 10,000 in income taxes. Simple, no?

Yes, and in a progressive tax, progressive refers to the way the rate progresses from low to high. I was using it as a relative term since the rate is higher for the luxury items, which are generally only items the upper strata of society can afford. A bad use of the word progressive I'll admit, but spare me the cynicism.

As for you, Mr. Saint-Deare, you haven't explained how VAT puts this pressure on households with greater consumption than savings.

Items detrimental to the growth of the economy are taxed more. Therefore they cost more. Less incentive to buy them. More money for government and public. Simple, no?
 

unmerged(23409)

LevePalestinaKrossaSionis men
Dec 13, 2003
586
2
"Mr Reczynski, It is my opinion that a VAT would be the best for Eutopia. As much as Conservatives despise Taxes, it is the only way that the Military will be funded adequetly without comprimising other services such as Healthcare. Last term, the UP had to take money away from Medicare to fund a re-armament program, and the VAT will aslo fund Healthcare. Are you going to sacrifice much needed Omnicare and Military equipment over your crusade for the 'overtaxed' rich?"
 

Brownbeard

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If I must, I will cover the basics of economics involving ad valorem taxation.

VAT in its essence is an ad valorem consumption tax of regressive character. It does not target income or savings, but consumption.

Even though a uniform tax rate would make it seem that it taxes everyone equally, it does not. Since it taxes consumption only, those with higher consumption percentage relative to their total income pay relatively more taxes than those with lower consumption to income ratio.

Now, the relationship between income, consumption and savings. Each individual distributes his income relative to personal needs. There is a consumption minimum that must be satisfied, the rest of the income can be distributed on additional consumption and luxuries or can be conserved into savings. How does this affect households of different income levels? Since a minimum consumption level must be satisfied, households of lower income have a much higher percentage of consumption compared to those of higher income level. They simply do not have excess income to save. This causes that lower income households pay relatively more taxes through ad valorem taxation than higher income households. There is no VAT on savings. And any VAT as such is a regressive tax that places greater pressure on lower income households than those of higher income.

Is a 0% tax rate a hand-out? No. Each and every item in this category applies equally to every member of Eutopian society regardless of their income. The goal is simply to make these products more accessible and to stimulate their consumption. These are investments. Investment in diapers ensures that the aging of Eutopian work force pool will take a slower pace. Investment in books ensures that future Eutopian work force pool will be highly educated, skilled and able to compete on the world market. Investment in medicines and medical services ensures that Eutopian populace will be healthier and more productive. Regardless of income, all these categories ensure greater economic growth and prosperity of Eutopia. Each in its own way is an investment in this great nations future.

Is a 25% tax rate a rich mans tax? No. As an opposite of products in the 0% tax class, these products represents a squandering of national assets. This tax rate targets consumption which does not lead to generation of wealth, but is in some ways detrimental to Eutopian economic stability. Will this target only the rich? No. It will target anyone who buys these things regardless of income? Will the rich always pay these taxes? No. I see no definite relation between how much a person earns and how much they spend. Some might say that the more one earns the less he is willing to pay... But the important question is how do these things affect Eutopian economy. Luxurious cars and yachts are import goods. By penalizing these products we may motivate our citizens to focus their funds into either savings or alternative domestic production without violating WTO or CAFTA principles. Luxury homes... one might argue that real estate prices rise and and this accumulates wealth, but with Eutopian real estate prices, a 600,000Đ is more than enough for quite a luxurious villa. Sums above that are only squandering resources and room. Eccentric estates susceptible to loss of value. As the tax states, it only defines homes, not real estate used in economic reproduction. A family farm of 1,000,000Đ is not subject to this tax, nor a family hotel. Only purchase of homes above that price.

Firearms, jewelry, furs... while nothing could be gained by forbiding the sales of firearms and furs since a black market would soon compensate demand, a higher tax rate might stimulate our citizens to spend their money on something else. Does a gun kill or a person shooting the gun? This is not the time to discuss that subject. What I am sure is that a higher tax rate will raise the prices on firearms and lower demand for the same and increase responsability involving firearms. As for furs I have no intention about getting into moral debates... with Eutopias moderate oceanic climate most fur is imported and if that import can be compensated with domestic clothing, all the better for Eutopian trade balance. Wear a leather coat instead of a fur one, as long as its Eutopian leather.

And finaly, vanity... if it's cheap it's not worth having... again I see no reason why not to tax the vain. The main effect desired is to reduce demand for such services and remove the burden on Eutopian medical system.

I believe I have covered every aspect, and still fail to see any ground on which VATA as an attempt to rob the rich. The VATA targets everyone according to their consumption habits. It favors responsible and sound economic consumption and penalizes irresponsible and/or eccentric consumption. Every individual determines how much they will contribute through taxes according to the economic responsability of their consumption. Invest and save and you will be rewarded, squander and you will be penalized. Everyone has a choice, income level has nothing to do with it.
 

unmerged(10397)

Citizen
Jul 27, 2002
1.023
0
I will take this oppurtunity to say that though the UMP was not in the least bit involved with General Levarge's deal with the President, I am not necessarily opposed to this bill.

I am discussing the matter with my party, and will shortly be ready to make a decision.
 

Sterkarm

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I am not totally opposed to this bill in principle, but I find it to be a bit extreme. Also, I would like to know the ECB projections on just how much tax income this would actually generate, and perhaps how much a 5-10-15 VAT would generate before I make a final decision.
 

unmerged(36605)

Recruit
Dec 3, 2004
3
0
Let's not get lazy after we've promised to be more active this half of the term. Greenbridge gave this press release:

The Speaker of the General Assembly has requested the analysis of the Central Bank on the impact of the proposed Value Added Tax. After consideration, it is the opinion of the Central Bank that this tax will raise approximately 16.5 billion ducats in the immediate outyears.

It is further the opinion of the Central Bank that this tax will cause a short-term rise in the rate of inflation.

Eutopia can handle a short term rise in inflation, and a 16.5 million ducats increase in our budget is well worth it. I remind the UMP and CUE members that there will be no money for their military reforms if they block the VAT.
 

Brownbeard

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Such an effect is to be expected, although i'm not sure if we can speak about an increase of inflation. There will be a one-time increase in market prices, something most people interpret as inflation, but inflation in its essence is a gap between supply and demand, and when the market fails to overcome that gap it generates a push on the prices to compensate. The VAT will not extend this gap and increase inflation pressures. After a one-time increase in prices, a small reduction in demand might make the gap more narrow... in fact, the implementation of the VAT might lead to reduction of inflatory pressure over a mid to long term period.

As for the income generated, I am sure it will create a significant boost to investments in key projects and make the Eutopia a better place for all of us.
 

unmerged(10397)

Citizen
Jul 27, 2002
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Well, I've heard all I need to hear on the subject.

Unless anyone wishes to raise an objection, I will be putting the VATA up for vote later today.

Before any new bills are proposed, I want to bring Hawkton Tilly's confirmation as Commissioner of Justice to a swift vote.
 

Sterkarm

The Honorable Judge Mental
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Once again I would like to emphasize that decreasing the extremes of the two categories would greatly increase its chance of passing, as well as decreasing the the initial strain on the economy. Perhaps we could agree on a incremental VAT in which the tax starts out at 10%, moves up 5% after one year, another 5% after another 2 years, and another 5% after 3 more years.
 

Brownbeard

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While I respect your concern I fail to see how they will put strain on the Eutopian economy.

The bulk of consumer goods and services will be covered by the 10% rate, the 25% rate will target only a few percent of total Eutopian trade, maybe even less so its effect will be negligable. The point of the 25% tax was never to create a large tax income but to stimulate consumers into alternative use of their funds. Savings or a more economically efficient consumption.

On the other hand, gradual implementation of the higher tax rate might make its introduction a smoother process. But it also brings certain dangers. It might create large market problems involving certain products and services of limited supply, primarily medical services covered by the 25% tax, and potential security problems involving firearms. In both cases, the announcment of gradual implementation of the tax might create massive boost of demand prior to increase of rates to exploit cheaper taxes. While this would not be a problem with other products, where supply is not limited, this does not apply on medical services. Increased demand should lead to increase of prices and their stabilisation, but in this case, increased demand might lead to squeezing out other non-profit medical services during this time, which would lead to nationwide deterioration of Eutopian healthcare. To put is somewhat literaly... Liposuctions and nose-jobs will squeeze out the the sick out of hospitals.

As for firearms... there is a great danger involving speculators and a creation of black market. The same gradual implementation might lead individuals into purchasing large quantities of firearms prior to the tax rate rise and selling them afterwards for profit. All the work put in into responsible ownership of firearms might simply dissipate as large quantities of unregistered and uncontrolled firearms enter Eutopian society. I need not go into potential problems this might cause.

So, to conclude my thoughts on the suggestion of gradual implementation of VAT. It is applicable for points III.a,b,c,e,f, but its application on points III.d,g might create significant damage to Eutopian society, and many social problems. If my fellow members of general assembly feel that such gradual implementation is a neccessity, then I see a possibility of gradualy rising the tax on points III.a,b,c,e,f from 10% to 25% percent over a selected time period, but its instant implementation is neccessary on points III.d,g due to the nature of goods and services in question.

As for the future of VAT. This was never intended to be a final solution. Eutopian economy is a dynamic organism, and as such it must be followed by a dynamic taxation system. This primarily targets the purchase of real-estate, cars and yachts over certain values. As economy prospers these values will need revision. I believe these limits should be adjusted depending on economic growth and rise of real-estate prices on a five-year basis.
 

unmerged(10397)

Citizen
Jul 27, 2002
1.023
0
Alright, given that the supporters of this bill clearly do not intend to change it based on MGA Reczynski's suggestions, and no-one else has voiced considerable objection, I consider this bill to have been adaquately debated to be put to a vote.
 

unmerged(10397)

Citizen
Jul 27, 2002
1.023
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Before we begin discussing anything else, including a revised version of the VATA, I'd like to vote on Hawkton Tilly's appointment as Commissioner of Justice. If someone will second this, and no-one objects, I'd like to put it to a vote rather swiftly.

Appointment of a Eutopian Commissioner of Justice

In following with the High Court's nomination, Hawton Tilly is hereby appointed to the office of Commissioner of Justice for the United Provinces of Eutopia.
 

Sterkarm

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The mood was somber in the General Assembly chambers. All was quiet as Kazimierz took to the podium.

"Countrymen, patriots, and fellow Eutopians. We have undergone a terrible tragedy lately. This is a day which, in Franklin Delano Roosevelt's words, will live in infamy. Never can our nation forget this black day.

HOWEVER, we must never forget that this is not only a tragedy, but it is first and foremost an assault upon both the Eutopian people and their nation! NEVER shall I stop in bringing those responsible to justice and ensuring they suffer for all eternity for their crimes! We as a PEOPLE must unite to punish these bastards! I say that with no lack of hatred. There is nothing short of the trial of each and every last "friend of durruti" and hopefully send all those responsible for today's bombing to prison for a long time. And I personally believe that there is not one among them who is not going to burn in hell.

Now, these scumbags claim that they are fighting for a "revolution". One of the leading communistic fascists (though not directly aiding the terrorists), Mr. Dank, is a man whom I have instructed on the utter faults of communism in all its forms. His extremist views and actions have shown him to be quite suspect in this as he shows support and sympathy for these terrorists, despite what he may claim. This "revolution" is a farce, headed by those who will laugh as they see the Eutopian nation, its economy, and its people crumble and sink. They start off their message of deceit and falsehood with a quote from Malcolm X, a respectable man, unlike the cowering fools and scumbags that head this false revolution. He fought against true oppression, and never did he attempt to plant a bomb specifically to kill innocents. And which was more effective, the bloody revolution of Malcolm X, or the peaceful revolution of Martin Luther King Jr.? The latter.

Why does a revolution of the people kill the very people they say they are fighting for? Why do they destroy the very places in which those people work? Without jobs society cannot exist. Their very message is false.

Once again let us unite as a people to bring an end to the horrible people heading the terrorists who claim to be fighting for the people. They are not the righteous crusaders that they say they are. They are terrorists first and only, not patriots, revolutionaries, or even worthy of life. Let this great nation be whole once more, and let us rid ourselves of the disease that is terrorism. May the people of Eutopia once more live in peace."
 
Last edited:

unmerged(37832)

Corporal
Jan 12, 2005
27
0
Oh you puffed up old frog are you done rattling your lungs? Once again you have tried to appeal to the popular sentiments of the public for your own ends, and have ended up sounding like a hormonal adolescent child in the throes of puberty. Allow a voice of reason to interject.

Our nation is stricken with a terrible terrorist attack, and instead of showing unity and solidarity with all Eutopians to face this challenge, you are busy exploiting it in order to silence a political opponent of yours. You and I may have our disgreements, but surely this is not the time to be voicing them.

I have expressed sympathy with the revolutionaries? How? By calling them intelligent and organized? Well I should certainly hope Eutopia hasn't fallen so low as to let a bunch of lazy disorganized idiots pull off something this big. Clearly it took good planning and organization to be successfull in blowing up the ECB. This isn't a compliment. It's a fact.

You can turn that finger your pointing at me and stick it up your ass. Perhaps if you wouldn't have been so uncooperative and unhelpful with the much needed social reforms, a bunch of idealogical purists wouldn't have felt the need to bypass the government and attempt things on their own.
 

unmerged(10397)

Citizen
Jul 27, 2002
1.023
0
O'Floinn slams his hands onto the table and stands up.

That's enough! Both of you, stop talking, right now. This Assembly is not for your ideological debates and condemnations, it is for the proposition and discussion of bills. Both of you, sit down and calm down, or I will remove you from this floor. Do I make myself clear?

Now, onto the matter of Hawkton Tilly...
 

unmerged(10397)

Citizen
Jul 27, 2002
1.023
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I have just received word that we are advised to evacuate several members to a secure location. Per Recyznski, unless you'd prefer to go yourself, I will be heading there myself, and I'd like to bring one member from each party.

Right now, my list looks like this:

John O'Floinn
Aldous Campbell
Thomas McGrath
Lamont Rashaad
Jean Saint Deare

If you don't want to go to the secure location, alert me immediately.

Bear in mind, everyone who goes will still be able to actively participate in the legislative process through e-mail and speakerphone.