SOLUTIONS FROM OUTSIDE THE BOX..... A TAX YOU WILL LOVE!
No – really! The Milligan Tax is a uniquely different form of financial transaction tax. First, it’s designed to speedily eliminate all personal and corporate tax returns - and within one or two years all the other sales taxes and onerous fees that so dominate our lives. Second, it’s almost unbelievably simple.
At .2% (two tenths of one percent) it may well be the smallest tax ever levied, yet It offers by far the largest potential source of funding anywhere on the planet. It would be collected automatically by financial institutions and monitored and audited in Canada by the Canada Revenue Agency (and by the IRS in America, etc.). In other words, it could be introduced free of charge, with no new bureaucrats needed. It will call for international cooperation but powerful organisations already in place like the World Bank, the IMF, the Bank for International Settlements (the BIZ) and the UN are well capable of fostering and co-ordinating this. With every nation on the planet facing un-repayable debt loads and our economies close to implosion how could there not be an interest – and econo-political advantage – in exploring a speedy solution?
Fairly distributed between all three levels of government rather than commandeered by some vast and unaccountable global organisation, the Milligan Tax is capable of totally regenerating communities, provinces and our nation in a manner no other fiscal measure could come even close to achieving.
It primarily targets the multi-quadrillion-dollar, untaxed and hugely speculative transactions of the complex stock, commodities and derivative markets. But in the interest of simplicity it also embraces all other financial transactions, at the same percentage rate of only .2%. We believe the Canadian people are responsible enough to want to make a contribution toward the cost of public services.
Some may believe that charging only .2% to the super-wealthy is insufficient, but it should be understood that Big Money never sleeps. It is constantly moving from one market to another, one currency to another; and it is the progressive and accumulative nature of the Milligan Tax that will provide the immense funding participating nations so desperately need. Should governments wish to add further legislation to capture an additional super-tax then that is their prerogative, but it is neither recommended nor necessary if the Milligan FTT is properly administered.
It’s a tax that barely touches Main Street banking and only lightly impacts upon Bay Street, Wall Street or the City. Compared to brokerage fees of 5%, interest rates of 5% to 8% or more, and tax rates well in excess of 30%, 2 /10th of 1% is miniscule.
Finally, while the Milligan Tax shifts the major burden of taxation from overtaxed citizens to the multi-quadrillion dollar speculative financial/commodity markets it is in no way a punitive tax. It is capable of offering great benefits to everyone, across a broad social/political spectrum and allows every level of government to make rational monetary, economic and fiscal decisions from a position of strength.
In short it gives us back our lives, beginning with the realisation that there’s absolutely no shortage of money – we’ve just been looking in the wrong place.
Like it so far? Please read on.
After several years of peer review, re-calculation, revision, updating and careful editing, the Milligan Tax proposal is now ready for public presentation and open discussion. We know that the proposal and the overview that follows are not perfect. Denied access to the inner mysteries of the organisations that control these multi-quadrillion-dollar transactions, or a true breakdown of the huge funds they process daily on behalf of each nation, we can at best offer only guidelines to a dramatic solution that lies ‘outside the box’ – one that appears to have been overlooked by G-8 and G-20 economic experts.
Finally, the Milligan Tax proposal is not being offered as the final solution to our pending economic collapse – that will require governments to stop borrowing from private banks at compound interest money they themselves are constitutionally required to create interest-free – but it does offer a massive life-saving transfusion of funding that would revive our economic lives and help us to resuscitate crumbling community infrastructure while restoring sound medical, educational and retirement programs.
THE MILLIGAN FINANCIAL TRANSACTION TAX (FTT)
Since President Sarkozy of France uttered the magic words “Tax the banks” at the opening of the General Assembly in New York, we have been hearing a great deal more about what is variously referred to as the Tobin tax, the Bank Tax, the Wall St. Tax, the securities transfer tax, the Robin Hood Tax and the Milligan Tax.
But is any one of these the real answer to our global economic problems, or are we simply being set up for yet another burdensome tax, this time a global heist, specifically designed to fund the immense cost of the rapidly emerging One World Government?
This article unashamedly supports the belief that only ONE of the proposed taxes provides genuinely workable solutions to our current chaos and that is the Milligan Tax. It has nothing to do with taxing bank profits and everything to do with taxing the financial transactions they process; funds that have for far too long escaped making any contribution whatsoever to our governments’ revenue.
The key lies in the answers to the following 10 simple questions, so let’s cut to the chase.
1. 1. WHAT FORM WOULD THE FTT TAKE?
It would be automatically deducted whenever a financial institution transfers funds between two different entities. It would therefore be equally effective whether markets are rising or falling.
In the interests of speed, simplicity and effectiveness, the Milligan Tax would be levied on all financial transactions, with no exceptions. Any exclusion, no matter how well justified it may appear, will greatly complicate collection and invite those tax loopholes so beloved of the super-wealthy
That means it would be levied not just on foreign exchange and currency markets, exchange-trade derivatives like futures, options and indices, over-the-counter derivatives such as Credit Default Swaps, Collateralized Debt Obligations, Structured Investment Vehicles and the host of other creative and hugely fraudulent forms of speculation. It would also include, as a relatively minor source, the trillions of dollars financial institutions process annually in their regular domestic and international transactions, including mortgages, consumer and business loans, credit/debit card and personal spending via on-line and cheque book transactions.
The most workable and effective FTT would be minimal – a suggested two-tenths of one percent (.2%) - but its target base would be astronomical and primarily focused not on people’s hard-won earnings, but on the estimated $3 quadrillion-plus (15 zeros) in hugely speculative ‘investment paper’ processed through the DTCC (the Depository Trust and Clearing Corporation) and its Euro counter-part, the ECSDA (European Central Securities Depositories Association).
Detailed breakdown figures are impossible for the public to obtain but, for all intents and purposes, we are looking at a global fund of astronomical magnitude.
DTCC covers 122 countries around the world and its Annual Report specifically mentions Canada, the U.S., China and India. Each of these nations has its own Depository and Clearing centre – in Canada it’s called CDS Clearing and Depository Services Ltd. – but all shares in these corporations are closely held by the banks and the breakdown of international transactions are jealously guarded. Presumably they are not beyond the reach of the CRA or the Finance Minister.
The ECSDA covers at least 40 different nations, including such countries as Lithuania, Estonia, Croatia and two separate clearing centres in Moscow. It appears NOT to include the UK which is handled through a DTCC subsidiary, so there could be additional trillions out there untaxed and unaccounted for.
2. 2. HOW MUCH COULD THE MILLIGAN TAX REALISTICALLY RAISE FOR CANADA?
Currently, all of these huge and largely speculative funds have managed to avoid taxation. From DTCC’s Annual Reports we know that the value of their 2008 transactions totalled $1.88 quadrillion. That’s up a 27-fold increase from the $70 trillion processed in 1999, the year of its inception and there’s every reason to believe that, properly fostered, monitored – and even encouraged - this figure could reach a staggering two quadrillion dollars a year;
A recent special report to the US Congress estimated Canada’s share of DTCC’s transactions to be roughly 6%, or close to $120 trillion. A tiny two- tenths of one percent FTT would therefore yield $240 billion, but it would do so at least twice over; once upon initial deposit transfer and again upon a withdrawal transaction. Like most other forms of taxation the Milligan Tax is progressive and total revenue could therefore be well in excess of $480 billion (see 5), plus billions more generated by our commercial banks from their domestic and international transactions.
3. 3. HOW WOULD THIS AFFECT CURRENT TAXATION METHODS?
The Milligan version of the FTT, carefully monitored and randomly audited in Canada by the CRA is well capable within one year of totally eliminating the need for personal or corporate tax returns and the constant, stressful threat of revenue audit. It will assign these to the scrapheap of history and is also capable of eliminating within one or two years the 140-plus other burdensome forms of taxation, including HST/GST and the many other taxes disguised as ‘fees’.
Future activities of the CRA would be entirely focused upon the monitoring and auditing of financial institutions, brokerage houses and the like, to ensure full compliance and to seek out any attempts at off-book transactions, in-house transfers, off-shore activities, manual computer over-rides or other such malfeasance. Evasion would result in serious jail time – nothing less than 10 years - for guilty CEOs, directors or partners. Because of the immense harm such fraudulent activities would do to millions of respectable citizens, it is proposed that such terms of imprisonment would be served without possibility of parole, in regular correctional institutions and not in exclusive and pampered ‘country-club’ facilities..
4. 4. HOW WILL THE MILLIGAN TAX IMPACT ON ME AS A TAXPAYING CITIZEN?
The key benefit of the Milligan Tax is that it focuses on those who can best afford it; which was said to be the original intent of the personal income tax system.
Let’s take a simple example based on an annual gross salary of $50,000.
When your employer transfers that amount into your bank account over the year it would incur a total transaction tax of $100 (.2%). This automatic deduction would be achieved by a simple modification to the banks’ highly advanced computer system.
When you make a withdrawal, by whatever means, let’s say for example to pay a mortgage of $2,000, that ‘outward’ transfer amount would again automatically be charged .2% FTT; in this case for an amount of $4. (Yes, that’s four dollars!)
At the end of the year, whether you transferred your salary a few hundred or a few thousand dollars at a time – or took it all out in one transaction - , you would never pay within the year more than a total of $200. ($100 transferring it in and $100 transferring it out).
That would be your total income tax responsibility unless you decide to ‘play the market’ with the disposable element of your salary. Even then you would never again be called upon to fill in a tax return! Eventually you would cease paying any of the 140-plus taxes/fees that have made our lives in Canada such a fiscal nightmare. It’s insane that most individuals need help to plough through their own tax return and even tax lawyers are unable to keep up with the constant changes to legislation.
5. 5. HOW WILL FTT FUNDS BE DISTRIBUTED?
This is the key question in determining whether a proposed ‘Transaction tax’ is genuinely designed to help the people or simply a way for the financial elite to maintain global control. Any proposal that doesn’t distribute the wealth by including our hard pressed communities should be disregarded.
Part of the automatic process built into the computer systems of every financial institution in Canada, beginning with the CDS Clearing and Depository Services Ltd., must be the transfer of collected funds direct to the national treasury. This would be done at the end of each business day, accompanied by a simple statement of daily, plus cumulative monthly, quarterly and eventually annual figures for auditing purposes. Following the end of one complete year, ‘cumulative comparatives’ would also be included for careful analysis.
a) Using as an example the $480 billion referred to in 2) above, the Federal government would retain 50%, or $240 billion (see below).
b) 40% (approximately $190 billion) would be distributed by the Ministry of Finance direct to provincial treasuries in ratio to Census population figures. BC, for example, with nearly 13% of Canada’s population would receive roughly $25 billion.
c) The final 10% balance ($48 billion) would pass via provincial treasuries direct to their incorporated municipalities. With Canada’s population now at 34 million, this translates into approximately $1,400 per person so that a community of 40,000 residents would receive a huge $56 million injection of interest-free funding.
For the purpose of simplification, all figures have been rounded off but for the purpose of comparison, Ottawa’s total tax revenue in 2009 was $200 billion. Of this, Income Taxes totalled $150 billion, with gasoline tax and excise taxes adding another $50 billion. BC’s revenue from taxes was nearly $20 billion. A typical BC municipality with a population of around 40,000 might be expected to generate total revenue around $30 million, with $20 million-plus from taxation and the balance from provincial grants and transfers.
All such inter-governmental treasury payments would be made monthly in strict ratio to the last available Census figures, without deductions of any kind. These initial inter-governmental transfers would be the only financial transactions to be excluded from the Milligan Tax.
You will note that none of this fund is distributed outside Canada. This proposal recognises the urgent need to first get ourselves out of deep debt before we can afford to worry about others. According to a 2004 Fraser Institute report, when Program Obligations, unfunded Contingent Liabilities and Debt Guarantees are added, Canada’s total all-government liabilities exceed $2.7 trillion and we pay private lenders $65 billion a year in interest and bank charges. The biggest concern by far, was ‘the $1.5 trillion in unfunded liabilities that include Canada’s Pension Fund, Old Age Securities, Medicare and Civil Service pensions’.
That’s right, there’s no money left in the treasury’s coffers to cover these future obligations and part of the IMF’s ‘Structural Adjustment Program’ for indebted nations includes cut-backs or elimination of such public ‘benefits’ – even though we contributed toward them all our working lives.
How can we, overly ‘influenced’ by the United States, their presidents’ advisors and their Federal Reserve Board, continue to spend billions on foreign aid and foreign wars in places we have no right to be? We should instead be showing other nations where the major solutions lie...and we can now begin to do that, by our own example!
6. 6. WHO WILL MONITOR AND AUDIT THE SYSTEM TO ENSURE TRANSPARENCY?
In Canada this would be the principal responsibility of the Canada Revenue Agency whose Minister would be directly responsible to the Finance Minister. The latter, in turn, is responsible to the Canadian people and he should never be allowed to forget that fact.
The gross value of the collected FTT would be reported openly in Parliament each month by the Finance Minister or his/her Deputy. Such figures would then belong in the public domain with free and open public accessibility. Upon acceptance by Parliament the appropriate funds would be immediately transferred to provincial treasuries. Should there be a reason for delay such payments could only be held up for a maximum of 7 days before correction, re-submission, acceptance and remittance.
They would then be posted on the Ministry of Finance and CRA web-sites together with quarterly and annual figures and with cumulative comparative figures from the second year on, to ensure total transparency and accurate analysis.
7. 7. WILL THE MILLIGAN TAX CAUSE INFLATION?
The important point to understand is that the small percentage of money we shall extract already exists and is already in circulation. It simply isn’t contributing toward public services. Taxing it by the FTT method suggested cannot possible create inflation, whereas the current system of borrow, tax, spend and sell-off (privatize) public assets to obtain cash is guaranteed to accelerate inflation to a point of collapse; as is the ridiculous US practice of creating trillions of dollars out of nowhere with no improved production or growth of GNP to back them up,
The source of funding for this version of FTT is quadrillions of dollars. The globally-interconnected foreign exchange and stock markets are now little more than huge gambling casinos except that the ‘chips’ are electronic; hugely leveraged virtual money moving in nano-seconds around the world’s highly coordinated financial centres.
We would simply be deducting a tiny fraction of these largely speculative and untaxed funds for the benefit of badly needed public programs and to eliminate the immense burden of debt represented by everything from post-secondary student loans and compound interest-laden mortgages and small business loans, plus un-repayable government debt that will otherwise burden our children and grandchildren until the system ultimately implodes, to be ‘saved’ by the New World Order. This is not a world we would choose to live in yet the laws eliminating personal freedoms necessary to achieve it are already moving quickly into place.
8. 8. WOULD PROVINCIAL TRANSFER PAYMENTS CEASE?
Yes. They, along with other complex inter-governmental transfers would quickly become unnecessary and each level of government would begin to regain its autonomy in a manner no other legislative change could achieve.
The federal, provincial and municipal comparatives in 5) above show the emphasis the Milligan Tax places on the strengthening of Canadian municipalities. Not that they aren’t as riddled with greed, corruption, deceit and fraud as other levels of government but they are close to home and we can do something to correct political and bureaucratic malfeasance. The main point, however, is that our communities are where we live, work and raise our families and it is there that a healthy financial position is absolutely imperative.
Hopefully, Canadians will one day learn to govern themselves using the principles of ‘subsidiarity’ – it’s an inelegant word but one used to describe a form of governance in which all decisions are made by that level of government closest to theissue. Having independent funding is a vital part of that enlightened process and is why the Milligan Tax is tilted so heavily in favour of municipalities.
9. 9. CAN THE LEGISLATION BE CONTAINED ON A SINGLE SHEET OF PAPER?
There’s no reason why not. It needs to be written in plain language – not ‘legalese’ – at a level that could be understood by a high school graduate. We would expect to see it completed within a matter of weeks, rather than taking months, or even years, as is usually the case with a new piece of government legislation. A change of this magnitude would normally create a huge long-term income for some favoured Ottawa law firm....with no guarantee that it wouldn’t then be allowed to wither on the vine, eventually to be replaced with even more complex freedom-draining legislation.
In the case of the Milligan Tax, the simpler the better. The more complex the legislation the greater the chance that it will be cleverly circumvented by those more than willing to seize on all the many advantages (no need for tax returns or audit concerns; no reason to face all the complexities and cost of off-shore tax haven accounts etc.) but who would still be willing to go to great lengths to avoid paying a simple tax of even 2/10ths of 1% on their financial transactions.
. 10. ARE THERE ANY CONDITIONS ON EXPENDITURES?
Yes – but only two are being proposed. First, no part of the revenue created by the Milligan Tax can be spent by Ottawa to wage wars of aggression in foreign countries or to finance ‘peace missions’ in support of US/NATO programs of poorly-disguised imperialism.
Canada, like Switzerland, should focus totally on genuine defence expenditure. National Service conscription for one year could be used to introduce our young men and women to other parts of this great nation, instil them with discipline and pride and provide us with the trained personnel we need for Coast Guard, Search and Rescue, Aid to Civil Powers and Emergency duties when called for.
Second – the only financial transactions to avoid the Milligan Tax are, as mentioned in 5) above, the initial inter-governmental transfers.
Government, commercial, mortgage, personal and student loan debt has now been globalised and there is not one nation on the face of the planet that isn’t facing bankruptcy as they sell off the last of their assets, squeeze the last drop of taxation from their long-suffering citizens and cut back on health, education, pensions and other social benefits to meet IMF demands. In the meantime governments struggle to keep afloat while bailing-out - using our tax dollars - the very financial institutions whose greed and deceit led us to this point of economic collapse.
Despite the one billion dollars Canada spent hosting the G-8 and G-20 this summer, not one viable solution emerged, but two things became self-evident. First, any real solution requires us to think outside the box and, second, the real answer we desperately need – the creation of money interest-free by our own public bank, the Bank of Canada - is not going to be presented by senior members of government, NGOs or the bureaucracy. They are too well served and rewarded by the current System.
Our governments are ill-informed when they speak of ‘short-term pain for long-term gain, or hint at ‘recovery within a few years’. The public have in recent years been looted of trillions upon trillions of dollars. It’s been the most fraudulent heist in world history. As a result, the global economy is now on the edge of total chaos and our personal freedoms under massive threat as the state prepares for social unrest to deteriorate into civil disobedience and, ultimately, revolution. That process is already under way in many of the more impoverished nations of South America and heavily indebted EU nations like Greece, Iceland, Spain, and Portugal. Our archaic economic, financial and fiscal models are crumbling while dysfunctional and corrupted governments, locked in a state of constant denial – and well rewarded to stay that way – are unconstitutionally handing over our sovereignty to the international banks and our jobs to foreign countries via their bonus-rich CEO cronies in the Supra-National Corporations.
The above ten questions are intended to offer some simple common sense guidelines and help identify the genuine solution as opposed to the many red herrings simply designed to divert our attention away from what may well prove to be an unprecedented opportunity to build anew and to get it right.
It is no exaggeration to say that this FTT proposal may well be our last real chance of positive change before the entire global economy collapses in an implosion of hellish magnitude. It’s surely worthy of urgent study, public input, parliamentary revision and early implementation.
We are not naive enough to believe that this can be easily achieved under our present political and electoral systems but we have some innovative and uniquely creative ideas we’d like to share with you on that subject too.