Transfer the revenueburdenfrom payroll taxes to value added taxes
I agree completely
Recall 100% vat credits are legal on exports
Result might be like a currency de Val
Which Portugal strung up with too high a wage structure and no way to cut loose given it's inability todevalas a pig in the euro poke
Question is the swap big eb
Nough to close the job gap by surging intra zonal national exports
Ie a parallel shift in the import export balance ?
Say. You get. A bump to GDP of 1% by a 7% cut in the payroll tax
--- here all of the employee side of SS tax --- and recapture the revenue with a 5 % vat
Knock out both sides employee and employer you get a 2% bump
Euro vat rule:
"For the purpose of exports between the Community and non-member countries, no VAT is charged on the transaction and the VAT already paid on the inputs of the good for export is deducted - this is an exemption with the right to deduct the input VAT, sometimes called 'zero-rating'. There is thus no residual VAT contained in the export price.
However, as far as imports are concerned, VAT must be paid at the moment the goods are imported so they are immediately placed on the same footing as equivalent goods produced in the Community. "
"VAT on goods moving between Member States
No frontier controls exist between Member States and therefore VAT on goods traded between EU Member States is not collected at the internal frontier between tax jurisdictions.
Goods supplied between taxable persons (or VAT registered traders) are exempted with a right to deduct the input VAT (zero-rated) on despatch if they are sent to another Member States to a person who can give his VAT number in another Member State. This is known as an "intra-Community supply". The VAT number can be checked using the VAT Information Exchange System (VIES).
The VAT due on the transaction is payable on acquisition of the goods by the taxable customer in the Member State where the goods arrive. This is known as "intra-Community acquisition". The customer accounts for any VAT due in his normal VAT return at the rate in force in the country of destination."
Looking at this
Then we can answer the how ?
That is the how
despite the balanced budget shift we can stimulate domestic output ?
By reducing imports thru both the income and substitution effect
And by raising exports thru the vat credit recoup
Of course all this requires heroic assumptions about reactive corporate price decisions
Upshot conducted by a corporate dominated state suspect this is simply a Scam-Bo move
