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Saturday, January 21, 2012

An Exercise in Upside Down Thinking

 Let's Tax Savings

(Savings is defined as money that does not flow and assets that do not aid in the flow of money.. Savings just sits there.)

---- Everyone should know by now that ALL TAXES ARE PAID BY THE PURCHASER -----
(For those of you that don't know this, I'll explain.. All items sold has a "cost of doing business" added to the purchase price. The cost of doing business includes corporate taxes.)

Money in a mattress does no one any good except for the "owner" who sleeps on it feeling secure.

Our current tax system taxes the flow of moneyTaxing the flow of money  slows down the economy.

Let's think about doing something completely different... Let's tax all money and assets that do not promote the FLOW of money.

I'm not suggesting going whole hog at this... there has to be some savings, but how much?
I suggest a percentage threshold, below which savings and idle assets are not taxed; above which is taxed.

Let's assume there is an optimum balance between the amount of money in "savings" and the amount of money that is flowing (being spent).  If the right ratio of savings versus spending was found, a dollar would remain a dollar: no inflation, no deflation. Everything owned, both savings and money promoting assets could be passed on to heirs without any devastating results.

The optimum process would grow both sides of the equation.  Savings would grow as the economy grows.

Of course, this plan has all the trappings of complicating itself like our current tax code. But the change would promote the economy instead of  hinder it.






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