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Corporate

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TAX

INCOME

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TAX

distributive

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TAX

Consumption

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TAX

  • Land estate transfer tax

    • tax-free purchase of private home, if for personal use for the next 10 years and up to typical regional value of 100 square meter

    • progressively higher for larger properties and/or if bought for letting with motive of profit

    • Add 25% property development tax on difference between adjusted purchase and sale amount if property is resold before 10 years 

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  • Inheritance tax on property

    • tax-free inheritance of private home and building grounds between 1st degree family members (e.g. including aunt to nephew) up to an equivalent average regional value of new 100 square meter (e.g. 300,000 € in Germany) 

    • progressively higher for larger properties, up to 75% (e.g. all value above 5M € to be taxed with maximum rate)

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  • Dividend tax

    • 25% on all earnings through dividends, not to be deducted with losses from other financial transactions

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  • Rental income tax

    • Annual rental income to be taxed progressively depending on total rental income

    • Tax deduction through investment deductible up to 5% of property value, option to spread out over 3 years

  • Luxury tax 

    • Double value-added-tax on items with sole display utility (e.g. diamonds) and over-proportional cost to individual utility (e.g. yachts, high-end sports car)

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  • Value-added tax

    • Zero for basic need items (e.g. standard food products [raw vegetables], water, educational courses)

    • Typical (10-20%) for most utility items (e.g. furniture, cars, non-standard food products [Mars bar, frozen pizza])

    • High (30-50%) for items with high resource load compared to utility, size or volume (combined use of water, energy and natural resources, e.g. heavy packaging for 150 ml drink)

    • Reduced tax for repairs and purchase of replacement parts, including labour, for all electronics, clothes and bicycles 

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  • Sugar tax 

    • Beverages with 6% or more sugar to be progressively taxed, 9% and above for natural fruit juices with fruit content of >50%

    • Food items with 25% or more sugar to be progressively taxed

    • Artificial sweeteners to be scrutinized for side effects with long term studies paid by the manufacturer or licensor  

    • At least 10% of tax revenue must be used for awareness campaigns and dental hygiene programs

    • Additionally, at least another 10% of tax revenue has to be invested in sports promotion, e.g. building a sports ground

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  • Alcohol and tobacco tax 

    • High taxes on both substances

    • At least 25% of tax revenue must be used for prevention initiatives, counseling and therapy

    • Expanded on marijuana in case of legalization

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  • Medial entertainment tax 

    • Small pay-per use for each time unit (e.g. 0.1-0.25 cents per minute), binding for all media (streaming music or movies, YouTube, TV, radio) per active device per household

    • Certified infotainment or documentaries free of charge

  • Direct income tax 

    • Progressive taxation with maximum granularity of percentage (to prevent a promotion causing the employee to earn less)

    • Maximum taxation rate well above median income of a country (e.g. if the median income is 30,000$, the maximum taxation rate should be at 90,000$)

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  • Managerial compensation regulation for public companies

    • The performance related part of an executive's salary has to be democratically decided by the two tiers below, based on initial height of bonus as guideline and relative performance (e.g. if a CEO has a 50% bonus agreement, it could be anything between 0 and 100%)

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  • Tax free earnings 

    • Tax-free earning allowance of basic income equivalent (e.g. 800€ per month in Germany, 9600€ annually) 

    • Full untaxed earnings up to basic income equivalent while receiving state benefits (e.g. 400€ unemployment benefits and 400€ earned through 10 h/week part-time job)

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  • Minimum wage

    • Must equal 'living wage' of a certain country for a 40 h/week, typically 2 times basic income equivalent (e.g. 1600€ per month in Germany, 21.5 workdays in average * 8 hours = 172 hours, results in 1600€/172 = 9.3 €/hr

    • No exception through temporary work or interim staffing

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  • Voluntary work benefits

    • Every hour of voluntary work or proven family caregiving increases tax-free earning allowance by minimum wage hourly rate, i.e. every hour can be tax deducted as a donation of the minimum hourly wage rate

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  • Finance authority collaboration

    • State tax software should be highlighting the rights and options of employees, be easy to use and free of charge (to move away from the 'us against them' mentality regarding taxes

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  • Tax deductions for resource efficient behaviour

    • All bills for replacement and repairs of electronics, clothes and bikes can be deducted by 50% 

  • Basic corporation tax

    • Progressive taxation by relative revenue (e.g. Increasing tax rate between 250,000 € and 5M €, above 5M € constant)

    • No tax for small enterprises (e.g. up to 250,000 €)

    • Actual taxation based on drivers of fairness and sustainability

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  • Driver: Pay gap fairness 

    • Taxation higher for companies with a larger spread between lowest earning worker and top executive, no exceptions regarding temporary workers

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  • Driver: Externalities

    • Incorporate full-cost paradigm to products by not only looking at utility, but also hidden costs to human and environmental health

    • Create new economic value dimensions (benefit to society and nature) for products and services

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  • Option A: Tax lever

    • Direct: Higher tax rate for products and services with high resource consumption as well as environmental and societal burden according to Life Cycle Assesment (e.g. a company has to pay higher tax if the product is non-recyclable or with inbuilt obsolescence)

    • Indirect: Higher tax rates for raw materials with high resource consumption as well as environmental and societal burden according to Life Cycle Assesment (e.g. A refinery will have to pay more tax if they use PET over PLA for their packaging)

    • Certain sectors may apply for reduced application of this driver if considered of foundational economic importance, e.g. cement, steel

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  • Option B: Full-Cost-Accounting customer side

    • Equal tax treatment but downstream customer has to pay for additional costs incurred to society and environment

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  • Option C: Full-Cost-Accounting provider side

    • Equal tax treatment but vendor has to pay for additional costs incurred to society and environment

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  • Driver: Social practice

    • Slightly lower tax rate for higher percentage of disabled, long-term unemployed and previously convicted people

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  • Driver: Organic growth

    • Tax rate depending on R&D budget versus M&A spending (lower tax rate for companies with a strong research and development portfolio)

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  • Prevention of tax evasion / domestic market revenue contribution

    • Corporations above 1M revenue should be taxed proportionally to the amount of revenue created within a certain nation state, irrespective or internal transfer of funds

© 2017 by Till Weidner

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