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Why the untax — a tax that is refunded to all citizens — works
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It sounds circular. It's not.
If we tax oil/gasoline, but return every penny to taxpayers, will it accomplish anything? Won't people be free to just keep spending the money on gasoline?
You might do that; many people might do that; but you'll still come out ahead. Here's why.
The untax works in the same way as Alaska's "oil-industry dividend." Every year every Alaska resident is mailed a check in June — their share of the State's oil tax revenues. Likewise, the untax revenues would be rebated to every U.S. resident — child and adult.
You could turn around and spend your rebate on gasoline, and you'd be pretty much even. But you'll have an incentive not to. If you consume less gasoline — buy a better car, or use transit more often, for example — you come out ahead. You still get the same rebate check — the fact that you spent less on gasoline and therefore paid less tax has a negligible (1/300-millionth) effect on your check (since the revenues are divided among everyone). But you've saved money.
Not everyone will be able to save gasoline. But experience shows that enough people will to make a difference. That difference — that reduction in oil consumption — is what will fight OPEC. (See Will a buyers' cartel work?)
Of course, not everyone will be in a position to use their rebate check to pay for their petroleum consumption. Since the untax provides the same rebate to everyone, those people with higher-than-average petroleum consumption — these tend to be higher-income/rich — will pay more in tax than they get back in their rebate checks.
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http://zfacts.com/p/995.html | 01/18/12 07:25 GMT Modified: Sun, 11 May 2008 18:09:51 GMT
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