New Worth Tax why it is fair to all

New Worth Tax why it is fair to all.
Funding Government is necessary for a society. Historically Protection and Justice are the roles of Government. Funding those services has become the debate.

Our economy is the exchange of goods and services. Unlike a barter system of items or services for the item or services in direct exchange: money provides a medium for exchange. Money moving through the economy promotes the growth of an economy.

A term to be familiar with: Velocity of Money, defined as;

“Simply defined, the velocity of money is a measure of the economic activity of a nation. It looks at how many times a unit of currency ($1 in the case of the United States) flows through the economy and is used by the various members of a society.”

Wealth is the accumulation of Money. After it has passed through the economy. Net Worth is the result of adding up all assets owned and subtracting all tangible liabilities.

Income for tax purposes “the amount exchanged for goods and services net of all related costs”. This is not wealth. True Income, “what is left after all personal expenses are deducted.” It is also accumulation. This excess once invested in assets becomes wealth.

When income is the basis of taxation the focus shifts. Taxing income penalizes the strivers in society. Strivers drive expansion of knowledge and commerce. Consider, should government’s share of your efforts increase as your efforts are more successful.

Many States use a consumption tax model of sales tax. Effective on the local level to fund the government, it affects the community in an uneven way. Proportionate taxation affects the lower classes more than the upper-class. A greater percentage of the disposable income of lower classes is taken by the government.

Like the sales tax other taxing models; Vat Tax, Flat Tax or National Sales Tax take from the economy. Taxes that remove money from the economy to fund the government interrupt the velocity of money.
Interrupting the velocity of money for the local taxes has a lesser effect on the local economy. These taxes are usually paid to local government employees which reintroduce the money into the local economy.

These taxes used separately or in conjunction with an Income tax on a National Level removes from one local economy and redistributes it to another. This redistribution interferes with the growth and vitality of an economy.

Gaining the greatest benefits from the velocity of money requires it to remain working in the local economy.

The Net Worth Tax only removes money for the benefit of the government after it has accumulated as wealth. Once the money is converted to wealth it has exhausted its velocity in the economy.

Net Worth Tax is different from Income Tax. Net Worth Tax is on all assets regardless of the ownership. Income earned by a nonprofit is not subject to taxation, and the assets are many times not subject to local taxes.

By taxing all assets, which are an accumulation of wealth, net of all liabilities, strivers are not penalized for achieving.

Achievers create new business and services expanding the economy. Some Achievers will create more personal wealth; others will consume the fruits of their labors.

Beyond the funding of government, the Net Worth Tax best represents the fairness of a tax system. Knowing that fair is a relative comment. Those that have received the most economic benefits of our society will be supporting the Government.

Candidly the wealth of the society is created by the society through the efforts of the individual.


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New Worth Tax why it is fair to all — 2,797 Comments

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