Shireroth

There's also the possibility of having a Commonwealth-wide tax, and then distributing the funds to the nations of the Commonwealth...

An idea not well thought-through though.

Jonas wrote:The problem is that we can't stop our citizens to open an account somewhere else (the Nederlanden for example) and move their money to it when it's tax time.
Of course we're all patriots, who proudly pay their taxes. But there are always people who don't want to.

A simple solution: limiting transactions to a foreign country. A limit of, for example, 2000 Kruys / month. It's the easiest to do. Those with more expenses can contact the minister, who can give approval of spending more.
This is easy to check.

Erik, the tax thingy works? Excellent (I saw it, but didn't know it worked)!

I can give you more specific recommendations if you give me the specific details of your tax system. But I'd strongly prefer avoiding solutions that affect all countries. The SCUE is designed to give you a currency and tariff free trade; not to impose any sort of economic system on you (he says while discouraging taxes precisely because of the difficulties noted in this topic). If we make an economy wide tax, we impose an economic structure on everyone. Same with transaction limits. Now, if you go and convince other nations to tax, and tax at similar rates and times to you, that's your business - and you're welcome to. But nothing should be imposed at the commonwealth level.

All that said, from memory, accounts with regional privileges can see transaction logs for those reasons. So you could make it a Batavian law that people can't transfer large sums out of Batavian accounts without prior approval from your government; and then examine the logs if you think people have. I expect it'll make transactions for Batavians harder, but that's just the free-trader in me ... it'll be interesting to see what happens, actually.

Jonas wrote:The problem is that we can't stop our citizens to open an account somewhere else (the Nederlanden for example) and move their money to it when it's tax time.
Of course we're all patriots, who proudly pay their taxes. But there are always people who don't want to.

A simple solution: limiting transactions to a foreign country. A limit of, for example, 2000 Kruys / month. It's the easiest to do. Those with more expenses can contact the minister, who can give approval of spending more.
This is easy to check.

Erik, the tax thingy works? Excellent (I saw it, but didn't know it worked)!

We could make up a system where we use VAT more (Belasting Toegevoegde Waarde or BTW in Dutch). This would say that if you sell anything in Batavia or to a Batavian you have to pay VAT to the Batavian government. This would keep the free trade system intact but would solve the disadvantages.

A simple solution: limiting transactions to a foreign country. A limit of, for example, 2000 Kruys / month. It's the easiest to do. Those with more expenses can contact the minister, who can give approval of spending more.
This is easy to check

I'm against this. People should be free to do what they want with their money. A government shouldn't be able to decide weither a citizen moves 200 or 20 000 to another country.

Nihill Romez wrote:

A simple solution: limiting transactions to a foreign country. A limit of, for example, 2000 Kruys / month. It's the easiest to do. Those with more expenses can contact the minister, who can give approval of spending more.
This is easy to check

I'm against this. People should be free to do what they want with their money. A government shouldn't be able to decide weither a citizen moves 200 or 20 000 to another country.

I agree, but it's the easiest way to avoid tax evasion. Otherwise we have to say that people can't move money in return for services. But in that case, they can just sell to themselves (getting their money). Nonetheless, the government would have to prove that the person tries to avoid to pay his taxes, what's make it terrible complicated.

Why don't you guys just pass a local law that limits what you can do in the SCUE rather than trying to have the SCUE pass a global law that affects everyone?

Yeah, we will, don't worry

I've given it more thought. I still think your best solution is to avoid taxes where possible; and your second best is to give your citizens incentives to pay their taxes fully; but barring those options, here are my two novel solutions:

Solution 1: Head Tax.
Charge each citizen the same amount of money, just for being a citizen. In second year micro, we learnt that this is the only tax that does not distort people's behaviour, so it should suit you. It's similar to the idea Shireroth had before of tax by Duchy.

Solution 2: Simultaneous Currency.
Erik's said the bank can handle multiple currency; so what a nation worried about tax evasion does is sets up a second currency. Start it at a nominally 1:1 ratio with the SC currency. And pass a law that all transactions in Batavia must be done in that currency. Your government keeps all the SC currency Batavia is allocated in governmental reserves.

Result: Within Batavia, people pay in Kruys. When they want to buy things from outside, they go to the government and swap some Kruys for SC (this allows you to monitor and ensure they're not just sending money offshore). They use this to pay the foreigners. When a foreigner wants to buy something from Batavia, they also go the government, and swap some SC currency for Kruys.

When tax day comes, Erik sets up a function where you just tax all Kruys that exist in the bank. So the government is always going to tax the same money base, even if its offshore.

Obvious disadvantage to 2 is that it's complicated, makes the government do a lot of work, and makes trade harder, which partly defeats the purpose of the SCUE. But it does solve your tax problem.

I don't like plan 2.
We (the current administration) are planning to redesign the tax system. I know that paying the same amount is the best way to let something work, but you aren't aware of how much 'we' like to make things complicated and write whole tax laws (that's why I don't translate it, it's long).

Now we are handling a problem with the Nederlanden about how to divide the money units when both join (as there are several citizens citizens member of both nations).

Well, if you want any more economic ideas, you know where to ask.

And I don't really wanna have to program 2. And it violates the spirit and point of the SCUE.