The Money Tax

There are three 3 types of taxes: Flow Tax, Amount Tax, and Mark-to-Market Percentage Tax.

Flow Tax: We are most familiar with flow taxes that claim a percentage of the money that flows to your (as with income tax) or away from you (as with sales tax.)

Amount Tax: An amount tax is becoming more familiar to people. Made notable by so-called “bail-ins” an amount tax is an explicit inflation-like tax that claims a percentage of the “buying power” that is on deposit in a checking account.

Mark-to-Market Percentage Tax: This tax claims a percentage of your property as it is determined to be currently priced in comparison to resent sales in the market. It is a tax on assets owned such as real estate property, other real property, or paper assets such as stocks and bonds.

Distortion of market signal caused by each type of taxation:

The first assumption about making payments in the market is that the person receiving the money provided value (such as real property or a service) that the money measures. A Flow Tax is an authoritative third party who provided no value in the exchange claiming that they earned a percentage of the money flowed in exchange. This creates an obligation where there should be independent voluntary choice on the part of the spender. The result is an involuntary obligation to serve the third party claiming a percentage of the payment.

 

Another common assumption about markets is that people own their property and it belongs to them. A Mark-to-Market Percentage Tax is when an authoritative third party declares their assessment of a property’s value to partially belong to them.

 

An Amount Tax is a tax on the money itself. In ERBM the entire money stock is divided into a Standard Measure of Value called a Ballot. Each Ballot is given to one person upon inductance into an instance of ER.  All Ballots can be divided infinitly and these divisible ballots are lent in marketplace exchanges. Each persons ballot is by default unlent and is therefore so-called “debt free.” Such unlent money is not “in the market.” This is analogous to banks having not-yet created money as loans, but it limits the amount of money that can be created to the population of the ERBM instance and disperses loan making decision power equally. In ERBM when money is “first time lent” it is subject to the term of the authoritative rule of the Republic which is 4 years and no interest is charged which establishes a common repayment of 25% of lent money per year. One way to implement this term is to enforce a 25% money tax on money on deposit which is credit that has been provided and thus to repay the credit according to the term of the republic causing dispersion of expired debts.

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