Tax Winners and Losers
By
William Cate
Passive taxpayers are always tax losers. Anyone, who expects nothing, gets nothing. For the most part governments give very little in return for their taxpayers' hard-earned money.
Governments are inefficient. Governments don't have an obligation to explain to the taxpayer exactly how their taxes are being used. Without this obligation, mismanagement and misappropriation are the norms of government finance.
Taxpayers are making an unwise investment decision when they fail to challenge their government's spending policies. It's like investing in a company and never knowing how your money is being squandered. Unless governments are expected to perform to benefit the taxpayer, government services never come close to equaling the cost of those services.
Proactive taxpayers seek to legally lower their taxes while enhancing the government benefits that they receive as a result of the taxes that they must pay. The proactive taxpayers' goal is to receive more benefits than the cost of their taxes.
The proactive taxpayer knows that businesses create jobs. National full employment is the foundation to social, economic and political stability. Governments offer financial incentives to attract job-creating businesses. Government incentive packages vary by government and industry. The sources of funding these incentive programs are passive taxpayers funds filtered through Regional Development Banks and other national and multinational agencies. For the proactive taxpayer these incentives ensure that they receive more benefits from government than they pay in taxes. Anyone who creates jobs or invests in creating jobs and doesn't expect the local government to offer an incentive program is a fool. And, we all know what happens to fools and their money. They are soon parted.
Most governments are willing to offer incentive programs to businesses that create jobs for their export market. Affluent countries offer incentive programs to those who create local jobs. A good example of government funded local incentive programs is the U.S. Small Business Administration (SBA). This Agency cosigns on startup loans for small businesses. It means that the businessperson can secure a business loan that would be unavailable to them, without the U.S. Government as the cosigner. The SBA offers a variety of business education programs and business services that have value. When your nephew comes to you and wants a hundred thousand dollars to start a dry cleaning business, your reply should be what has the SBA agreed to do for your dry cleaning company? The answer to that question is one way to enhance the benefits you receive from the taxes that you pay.
There is always a way to legally reduce your taxes. Unfortunately, if often requires a global vision, time, money and effort to do it. However, it's possible to legally be a non-payer of income taxes for the rest of your life.
The less legal way to reduce taxes in all countries is to join the national alternative economy for your country. Every country has two economies.
1. There is the national economy. This is the economy upon which the nation relies for taxes. Its Gross National Product (GNP) is the one reported to the world. It's the one that offers employment incentive programs, etc. National economic comparisons are always based upon data supplied by the government who operate the national economy.
2. There is the alternative economy. It's the one that isn't paying taxes, supplying statistics, etc. The alternative economy's size varies from 10% to over 90% of the national economy's GNP. For instance, if the national GNP is hundred billion dollars, the alternative economy is producing somewhere between one hundred and nine hundred billion in GNP without paying on the revenue.
In most countries almost everyone is at least occasionally a member of the alternative economy. Let's say that you are a plumber and fix your neighbor's toilet one evening. Your grateful neighbor gives you a gift certificate to a local restaurant. You go to dinner and fail to report the gift on your tax form. You have just done an alternative economy business transaction. There are businesses that exist entirely within the alternative economy.
The alternative economy grows and prospers during economic hard times. It's uneconomic and unwise for governments to try to stamp out the alternative economy. The alternative economy creates jobs and adds to social and political national stability. Plus, the government's costs to try to stamp it out are not offset by the potential tax benefits. Even at the height of the Cultural Revolution, China's alternative economy operated without hindrance from Beijing.
If you are an individual taxpayer and want to be a tax winner, you might consider joining the Global Village Investment Club [http://home.earthlink.net/~beowulfinvestments/globalvillageinvestmentclubwelcome/]. If you are a businessperson and want to grow your company with equity investment and government employment incentives, you might consider the path suggested by Beowulf Investments [http://home.earthlink.net/~beowulfinvestments/].
If you are content as a passive taxpayer, that's great. However, it is usually the contented cows that are slaughtered at the first sign of hard times. I submit that hard times are the dark cloud visible on the horizon for anyone to see.
By
William Cate
Passive taxpayers are always tax losers. Anyone, who expects nothing, gets nothing. For the most part governments give very little in return for their taxpayers' hard-earned money.
Governments are inefficient. Governments don't have an obligation to explain to the taxpayer exactly how their taxes are being used. Without this obligation, mismanagement and misappropriation are the norms of government finance.
Taxpayers are making an unwise investment decision when they fail to challenge their government's spending policies. It's like investing in a company and never knowing how your money is being squandered. Unless governments are expected to perform to benefit the taxpayer, government services never come close to equaling the cost of those services.
Proactive taxpayers seek to legally lower their taxes while enhancing the government benefits that they receive as a result of the taxes that they must pay. The proactive taxpayers' goal is to receive more benefits than the cost of their taxes.
The proactive taxpayer knows that businesses create jobs. National full employment is the foundation to social, economic and political stability. Governments offer financial incentives to attract job-creating businesses. Government incentive packages vary by government and industry. The sources of funding these incentive programs are passive taxpayers funds filtered through Regional Development Banks and other national and multinational agencies. For the proactive taxpayer these incentives ensure that they receive more benefits from government than they pay in taxes. Anyone who creates jobs or invests in creating jobs and doesn't expect the local government to offer an incentive program is a fool. And, we all know what happens to fools and their money. They are soon parted.
Most governments are willing to offer incentive programs to businesses that create jobs for their export market. Affluent countries offer incentive programs to those who create local jobs. A good example of government funded local incentive programs is the U.S. Small Business Administration (SBA). This Agency cosigns on startup loans for small businesses. It means that the businessperson can secure a business loan that would be unavailable to them, without the U.S. Government as the cosigner. The SBA offers a variety of business education programs and business services that have value. When your nephew comes to you and wants a hundred thousand dollars to start a dry cleaning business, your reply should be what has the SBA agreed to do for your dry cleaning company? The answer to that question is one way to enhance the benefits you receive from the taxes that you pay.
There is always a way to legally reduce your taxes. Unfortunately, if often requires a global vision, time, money and effort to do it. However, it's possible to legally be a non-payer of income taxes for the rest of your life.
The less legal way to reduce taxes in all countries is to join the national alternative economy for your country. Every country has two economies.
1. There is the national economy. This is the economy upon which the nation relies for taxes. Its Gross National Product (GNP) is the one reported to the world. It's the one that offers employment incentive programs, etc. National economic comparisons are always based upon data supplied by the government who operate the national economy.
2. There is the alternative economy. It's the one that isn't paying taxes, supplying statistics, etc. The alternative economy's size varies from 10% to over 90% of the national economy's GNP. For instance, if the national GNP is hundred billion dollars, the alternative economy is producing somewhere between one hundred and nine hundred billion in GNP without paying on the revenue.
In most countries almost everyone is at least occasionally a member of the alternative economy. Let's say that you are a plumber and fix your neighbor's toilet one evening. Your grateful neighbor gives you a gift certificate to a local restaurant. You go to dinner and fail to report the gift on your tax form. You have just done an alternative economy business transaction. There are businesses that exist entirely within the alternative economy.
The alternative economy grows and prospers during economic hard times. It's uneconomic and unwise for governments to try to stamp out the alternative economy. The alternative economy creates jobs and adds to social and political national stability. Plus, the government's costs to try to stamp it out are not offset by the potential tax benefits. Even at the height of the Cultural Revolution, China's alternative economy operated without hindrance from Beijing.
If you are an individual taxpayer and want to be a tax winner, you might consider joining the Global Village Investment Club [http://home.earthlink.net/~beowulfinvestments/globalvillageinvestmentclubwelcome/]. If you are a businessperson and want to grow your company with equity investment and government employment incentives, you might consider the path suggested by Beowulf Investments [http://home.earthlink.net/~beowulfinvestments/].
If you are content as a passive taxpayer, that's great. However, it is usually the contented cows that are slaughtered at the first sign of hard times. I submit that hard times are the dark cloud visible on the horizon for anyone to see.
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