- -Benjamin Franklin, 1789
As with most nations, the Triumvirate maintains several forms of taxes imposed on institutions like businesses, sales, or even savings. Taxes are provided for in Title 17 of the Universal Triumvirate Code dubbed "Revenue" and the Union currently maintains a few different forms of taxation.
Taxes first originated as a result of a push in late 2012 for a graduated tax on the income of businesses by Major Executive Stavrok, Head of the Treasury Andrew Hester, Ehtya, and Nathan Maine which resulted in the landmark Supreme Court case First Nation Consulting v. The Universal Triumvirate in which the court held that taxes were unconstitutional because they were the "forceful taking of property by the government" which was prohibited in the Constitution. As a result, an amendment to the Constitution was made that allowed for taxation on corporate income provided it was a flat rate and it was not higher than 20% of all income; but it was made clear that taxes on an individual's income were strictly unconstitutional. Thus, taxes came to stand but it would be some time before large adjustments in the basic principles of taxation in the Triumvirate would change. In August of 2013, under the direction of then Major Executive Nathan Maine, the government passed legislation that excluded capital gains from being taxed in any form. Shortly thereafter, in April of 2014, the Constitution was amended to allow for excise taxes and for tariffs to be imposed. Then, in March of 2015, the Brayer-Braugh Act was passed which repealed the corporate income tax and supplemented it with a corporate savings tax, though there were some doubts about the constitutionality of such.
Historically speaking, taxes have consistently failed to be high enough to balance out government spending and the government traditionally spends significantly more than it takes in each trimester.
Types of TaxesEdit
A tax on institutional income is a tax that applies to money that enters an institution's account over the course of a trimester which is then taxed at a certain percentage. For example, if the tax rate on institutional income was 10% and you owned a business that received 200 tri in income over the course of a trimester, the business would pay 20 tri in taxes.
A tax on institutional savings, which first came about with the Brayer-Braugh Act is somewhat more complicated in that it pertains to money in an institutional account at the end of a trimester. For example, if the tax rate on savings was 10% and a business simply had 250 tri in holdings (regardless of if it made only 50 tri or 500 tri in income over the course of the trimester), the business would pay 25 tri. Designed to be an incentive for more spending and for businesses to do something with their money rather than hoard it, this becomes more complicated as there are regulations pertaining to money moving to avoid taxation.
An excise tax is a tax on specific good that is paid with a sale of that good. For example, if there was a 10% tax rate on sale of newspapers, each time a newspaper was sold in the Triumvirate, 10% of the sale would be paid in taxes to the government. These are high for goods that produce negative externalities (things that are not desired) and low or non-existent for goods that produce positive externalities (things that are desired).
Tariffs are taxes on foreign imports wherein a certain portion of the value of a foreign good coming in is taxed.