A tax model

 

Taxation in China is very complicated, and it is hard for ordinary people to understand. This is undoubtedly not a Dummies. I think it is best for the country to unify taxation into one type, reduce administrative fees, and convert all fiscal revenues into one type of taxation as much as possible. This facilitates unified management.

 

Current taxes, such as personal income tax, are collected in proportion to individual income every month, which is undoubtedly representative. Rich people make more money. Of course, they need to pay more. If the poor earn less, they can teach less. The problem is that it is very troublesome to implement, because "making money" is a return-investment. Sometimes, if the investment goes out and there is no return, the country will not get a penny, and sometimes the return will come back, however, before the next round of investment, taxpayers need to contribute the amount of investment in the next round to a country in proportion, which is undoubtedly not sustainable. After all, the concept of "making money", that is, profit, is static. That is, you can know whether to make money after the business activities are completed, but business activities are continuous and consistent.

 

Why not start from another perspective? That is, starting from consumption. You don't need to pay taxes if you don't consume them. You need to pay the corresponding taxes if you consume them. Why are you able to consume them? Doesn't it mean you have made money? The country does not need to know how you make or how business activities are made. As long as you have money to spend, it means that you extract the money from business activities and use it as a profit, this is precisely the best tax collection time.

 

Some people say that I didn't make any money, but I also want to eat. It's impossible for the country to collect taxes from them. Is it so inhuman? These problems can be solved by technical means, and consumption can be divided into multiple types. For example, necessities such as rice, oil, and salt can be subject to tax-free policies, while luxury goods dedicated to entertainment for the rich can be taxed heavily, this balances the distribution of wealth in society.

 

The purpose of tax is to solve the problem of social distribution, rather than interfering with commercial activities and market operations. Why is the entry point of social distribution on consumption? In modern society, the industrial chain is very complex. The modern tax system requires layer-by-layer intervention, which undoubtedly increases the burden on enterprises and hinders the development of production relations. Products in commercial activities should not be intervened. These links should be tax-free, from factories to distributors, to retailers, and finally consumers. In such a typical commercial chain, it is only necessary for retailers to collect taxes from consumers. No matter who makes the money or serves as a consumer to fulfill their own labor results, the tax is collected only in one link, and the tax revenue of the country is not reduced, but the problem can be simplified, adverse effects on business activities can be minimized.