[{"id":165,"title":"Partial replacement of the FairTax prebate by a wage subsidy","sha":"2dba1ecd29b4f280cb145d48e5f42903","user_id":480,"state":"published","body":"The proposed FairTax Act (H.R.25/S.155) would replace most U.S. federal taxes, including payroll tax and all forms of income tax, with a retail sales tax. To compensate for the rise in prices of necessities, the legislation provides for an annual \"prebate\" of a fixed amount per legally resident adult, plus a fixed amount per dependent child.\r\n\r\nSome critics object to the prebate on the ground that it is an unconditional handout to able-bodied people of working age. This objection (whatever its merits or demerits) can be overcome as follows: for a person who is capable of working, make the prebate payable not to that person, but to any employer who hires that person at a legal wage (with a pro-rata prebate for part-time employment). Thus the prebate would become a wage subsidy, defendable as a Pigovian response to the social cost of unemployment.\r\n\r\nDue to competition, the wage subsidy would be passed on through some combination of lower prices, higher wages, and more jobs. All three modes would help to compensate working people for the sales tax. The first (lower prices) would reduce the required compensation for both working and non-working people.","created_at":"2015-05-25T09:50:57.944Z","updated_at":"2015-05-26T06:00:42.665Z","zenodo_id":30223,"doi":"http://dx.doi.org/10.5281/zenodo.17925","subject":null,"tags":["economics","taxation","consumption tax","basic income","negative payroll tax","fiscal devaluation","fairtax"],"vote_count":0,"view_count":1,"score":0.1,"deleted":false,"muted":false,"tweeted":true,"attachment_file_name":null,"attachment_content_type":null,"attachment_file_size":null,"attachment_updated_at":null},{"id":198,"title":"Equitable methods of abolishing PAYG personal income tax","sha":"ac8047dfeeafa46bfb129b1f559d966a","user_id":null,"state":"published","body":"It is argued that the replacement of pay-as-you-go personal income tax (\"PAYG tax\") by something more efficient (e.g. a land tax or consumption tax) would offend intergenerational equity because retirees no longer pay PAYG tax, and would offend vertical equity because higher-income earners would get proportionally larger cuts in PAYG tax.\r\n\r\nThese objections can be avoided by abolishing PAYG tax in such a way that the benefit, as far as possible, is received as \u003cem\u003elower prices\u003c/em\u003e rather than higher after-tax income.\r\n\r\nOne method is to let employers retain withheld PAYG tax or claim it as a credit against other taxes. Another is to reinterpret existing employment contracts by legislation, so that \u003cem\u003enet\u003c/em\u003e wages (not gross wages) are held constant through the transition, pending new contracts under new employment laws for the new tax system. Either method would reduce employers' costs, hence prices, without reducing workers' net wages.\r\n\r\nThe latter method is harder to legislate if more than one legislature is responsible for employment (as is likely in a federal system). But it is preferable in that employers would no longer incur PAYG compliance costs while workers would no longer face the disincentive of marginal tax rates on their wages.","created_at":"2015-08-08T11:50:51.084Z","updated_at":"2015-08-09T06:00:19.724Z","zenodo_id":52054,"doi":"http://dx.doi.org/10.5281/zenodo.27232","subject":null,"tags":["economics","taxation","income tax","land tax","consumption tax","fiscal devaluation","fairtax"],"vote_count":0,"view_count":1,"score":0.1,"deleted":false,"muted":false,"tweeted":false,"attachment_file_name":null,"attachment_content_type":null,"attachment_file_size":null,"attachment_updated_at":null},{"id":893,"title":"Loophole capitalism and tax havens: why practice matters more than place","sha":"30a736ce51bb88be1a3ef6695866905a","user_id":null,"state":"published","body":"The leakage of the Panama, Paradise and Pandora papers have highlighted the prevalence of tax minimisation by wealthy individuals and corporations. The language used to describe this is rooted in island/maritime terminology: ‘tax *havens*’, ‘*offshore* financial centres’, ‘*archipelago* capitalism’, and ‘treasure *islands*’ (see Palan et al, 2010; Ogle, 2017; Shaxson, 2011). Yet this confuses the practices of evasion with the place where it occurs, and suggests the problems associated with taxation are mainly in exotic locations far away. In fact, the world’s biggest tax avoiding places are not island tax havens, but financial centres such as the City of London, Amsterdam, and Singapore, and avoidance and evasion practices are widely used by business and individuals beyond these centres (Garcia-Bernardo, Janský \u0026 Tørsløv, 2021). We call this ‘loophole capitalism’: seeking to accumulate capital by exploiting processual and/or regulatory loopholes in taxation systems. These include using accounting techniques to evade and avoid taxation, undertaking regulatory arbitrage––and, of course, hiding wealth in tax havens. Because loophole capitalism only exists in the interstices of extant tax systems, it is inherently parasitical. Therefore, the places of avoidance are a consequence of the wider practices of loophole capitalism, not the other way round. Clamping down on tax havens therefore only addresses a symptom, and not the cause.","created_at":"2021-11-16T18:02:34.880Z","updated_at":"2021-12-27T06:00:33.520Z","zenodo_id":5805587,"doi":"https://doi.org/10.5281/zenodo.5805587","subject":null,"tags":["taxation","tax havens","tax avoidance","offshore financial centres","international political economy","loophole capitalism"],"vote_count":0,"view_count":1,"score":0.1,"deleted":false,"muted":false,"tweeted":true,"attachment_file_name":"MOLLAN___SAVOLD_Loophole_Capitalism.pdf","attachment_content_type":"application/pdf","attachment_file_size":57535,"attachment_updated_at":"2021-11-16T18:14:53.993Z"}]