But what it does mean is that interest rate policy is never going to be the answer to the question as to how to tackle inflation again.
Sigh.
In the absence of absolutely any other ideas that I have ever seen on this issue I still suggest that my proposal for a financial transaction tax on all the financial flows through the bank accounts of all individuals and companies, with very low rates on those on lower earnings, progressing to higher rates as flows increase, is the answer to this question, whilst also simultaneously providing the mechanism to eliminate national insurance, which is a holy unjust tax.
So you drive transfers outside the banking system where the velocity of circulation might be higher, thereby increasing inflation?
Holy Moly! The P3’s taken Wholly Orders!
“with very low rates on those on lower earnings, progressing to higher rates as flows increase, “
So is this transaction tax progressive upon earnings, or upon size of transfer?
He appears to say both in the same sentence.
Quite how a transfer being enacted between accounts at banks A and B can either party be aware of the earnings of the payer or payee…
But to be fair, we are supposed to have moved on from Victorian days out mocking the mentally ill. Though some exceptions are justified: ridicule is often the only effective countermeasure.
How does my bank know my earnings?
When money is transfered from my employer to me, who pays? me or my employer?
When I then transfer money from my account to my household account I have to pay again.
And when I transfer money from my household account to my mortgage lender, who pays? me or the lender? If I paid when I received my wages then the lender pays. But if I pay when paying my lender then when I get my wages it has to be my employer paying.
Oh, wait, I can see a solution to this. Both parties pay!
Coming soon, the P³ decides that mixing abrasive grit in his engine oil will improve his fuel consumption.
Oh, wait, I can see a solution to this. Both parties pay!
Yes, that’s exactly what happens in Peru, which has such a a tax. 0.005% of the total amount of every transaction, both parties pay and only transfers between accounts held by the same person are exempt. The tax take is next to fuck-all of course but it’s real purpose is so that the tax authority can work out how much you’re earning (as opposed to how much you declare to them). As our host implies, an awful lot of trade goes on outside the banking system.
Bloke in Callao
I doubt Murphy knows even where Peru is although its possible he picked up the idea second hand through one of his contacts. As you imply, it would seem to drive much economic activity outside the formal banking system. Decidedly retrograde for a ‘Progressive’ but my guess is it would be accompanied by the removal of cash and the banning of Cryptocurrencies to force you to funnel everything through accounts which the state can monitor and tax at will.
Tim the coder
I sometimes wish he’d cut to the chase and just admit that ideally he wants a world where the state confiscates all money and reallocates it on the basis of what he deems a person needs to live on. It’s be much simpler and a good deal less dishonest than his current garbage.
Coming soon: How interest rates at 20% will enable government to impose a windfall tax on banks and end the scourge of buy-to-let while curbing inflation.
“a financial transaction tax on all the financial flows through the bank accounts of all individuals and companies, ”
Isn’t that already done? In bulk, but still.. Income Tax is bulk. VAT is per transaction, and mostly anonymous on the consumer end. Plenty of other bits and niggles people more well-informed than me cn think of.
And that’s not even all of the taxes…
What he wants is access to our bank accounts.
Piano Wire is too good for him. So are Lions.. they might get indigestion. Maybe re-introduce the gibbet?
So he wants to reintroduce bank charges but have the banks pay the extra profit to the government
I try and avoid giving the imbecile any additional traffic as it means as per the opening post apparently he’s no longer in need of the money which is being donated to him by people who are apparently sympathetic (12K) but these are quite hilarious
The charge would also need to be applied to business accounts, and again some progressivity could be appropriate: support for smaller businesses could be implicit in rates charged. And businesses should not object, especially if they were relieved of some of their social-security costs. The issue of cash usage would have to be considered: it would be a legal necessity to require that cash sales and purchases were declared for tax purposes, to prevent abuse.
So if you buy anything in cash you have to declare it to the taxpayers? Send your children down to buy a magazine and some sweets or give them pocket money – declare it – or else!
Deciding how a person and their household were related might be an issue for this purpose; equally it could be an instrument for delivering social support. Transfers into and out of the country, even to related accounts, would however always be charged. Put all this together and this would become an effective and progressive tax on consumption.
Bang go a lot of remittances to developing countries.
This would be a progressive consumption tax–which value-added tax is not–and it would extend the tax base to financial services and transactions, which are the preserve of the wealthiest and beyond the reach of VAT. It could, therefore, be a significant tool for tackling income and wealth inequality.
Only the wealthy have need of financial services?
The fact that any charitable foundation deems this man a worthy recipient of funding casts serious doubt over whether that charity should continue to be permitted charitable status.
Have to agree with Grikath. Hanging is far too good for him.
How about this – we turn all your money into a central bank digital currency you keep on your smartphone.
And then we give it an expiry date and subject it to a negative interest rate.
Would have utterly fascinating effects on inflation.
He’s just got another lucrative grant
https://www.t*xresearch.org.uk/Blog/2021/11/22/a-funding-update-4/
But won’t stop asking for donations.
Utterly shameless
Agree with Grikath.
In Tom Kratman’s Carerra series, some particularly brainless idiots are false-flagged into an encounter with an industrial shredder, feet first, on Youtube.
End of stream of ‘useful’ idiots.
Job’s a goodun.
That was just science fiction, of course.
@SamJones – that link is delicious. He’s let someone call him a grifter and took it as a comp.
“ Only the wealthy have need of financial services?”
I’m sure what he really means is if you use financial services you must be wealthy. The sort of logic the left loves to use to justify their envy.
Surely all a bank account transaction tax would do is create transactions in something else one step removed from the bank account? In the way bank notes started out representing gold in the bank, and rather than actually shift the gold around every time people swapped notes for goods, the sellers of the goods just used the notes to buy things themselves. The notes flowed around the marketplace and the gold stayed exactly where it always had been.
I can see a simple way to avoid the transaction tax, especially at the higher transaction amounts. Just set up a company with a certain amount of cash in it, and then use the shares in the company as proxy for the cash. You could have companies with £10k in them, £50k, £100k, £250k etc etc right up the money tree until you reach Elon Musk. You buy or sell your house, you get paid in or transfer out shares controlling companies owning the right amount of cash. No money moves at all, no transaction tax payable.
Stamp Duty, Jim.
That said, I don’t think Stamp Duty was payable on bearer share transfers when I was doing this sort of thing. Still not? But bearer shares are effectively cash. It’s possession of the certificate defines ownership. Probably not the vehicle for the sort of transactions you’re talking about.
bis – offshore companies, with share registry by blockchain? Set them up somewhere with decent rule-of-law, maybe take some small fee off the top, or collect the (admittedly small) interest income?
BiNK (GP): well, that’s another way to increase the price of gold.