Taxing all transactions is jaw-dropping idea

The proposed change to U.S. tax law, Debt Free America Act, is still in committee, but the size of it is staggering. When you skim this, you may get the idea that this is simply another 1 percent sales tax. It isn't. This is a tax on every recordable transaction. You get a feeling for its size when you see that they are planning on paying off the national debt in seven years. They are hoping for a minimum 50 percent increase in tax revenue.

The legalese of this proposal leaves you wondering how this will be interpreted by the bureaucrats and the courts. For example, the text appears to say that every recordable transaction is taxed a full 1 percent. It doesn't appear to provide exemptions for transactions with yourself, your family or within a company. Transfer $5,000 from your savings account to your checking account and then spend it. That would cost you $100, plus the cost of what you are purchasing would be higher.

Even if it does exempt transactions with yourself and within a company, the implications are jaw dropping.

They are proposing a tax credit, but that is only applied once based on your total income.

See www.govtrack.us/congress/billtext.xpd?bill=h111-4646

William Smith

Iowa City