Article
Import Taxes
Hey, I'm writing to you, my congressman, about the import tax debate that seems to be going on. I would have liked to have broadcast this information, but i do not have the gold to make a newspaper, so hopefully my one voice will be heard.
The import taxes the eUS government has right now is a complete joke. A 1% import tax isn't something (in my opinion) we should ever have allowed as a government. I have read some of the information regarding this, those for keeping the 1% and those for raising it, and have found that, in some instances, both sides are right. However i thought I would throw some facts and figures that I *KNOW* to be true due to my own economic knowledge in real life. I saw a lot more LOGICALLY assume and assured negatives then i did positives, as i will list here;
POSITIVES
Point A - Repercussions of a low import tax - The positive aspects are apparent. We are able, as a country, to recieve goods at a severly discounted rate. Items that would cost (the equivlant) of 5 USD in another country only costs us 2.50 in this country. This allows players to buy items like weapons and food cheaply, allowing us to maintain a higher amount of our finanical income for other uses within the context of the game (like..... more weapons and food!).
Sadly, that is the only positive aspect i can see to lower the import tax. Now then, for the negatives that that is causing;
NEGATIVES
Point B - Repercussions of a low import tax - This particular list will go on for a bit, so i will list each by subsection;
Point B.1 - Small business' (Q1 - Q3) - I run what could be considered a small business. I just bought it, a Q1 wood business. I bought it with the free gold i earned from leveling, and hoped to make it grow a bit and prosper. It is an AMERICAN based business, as in it is inside our territory. After this business was aquired, i decided to hire some workers and see if i could make a profit. After a little reseach on the job market, i found that a Q1 laborer would run me about 15.10 USD per day worth of work. I was able to hire 2 my first day at this rate. In total, the laborers were able to produce 178 units of wood. With this product in hand, i looked to sell to increase my profit, perhaps increase my workforce, and thus let it snowball there. Imagine my surprise when i found that the going rate in the USA for Q1 wood was 0.11 USD per unit. For the 30.10 i spent in paying my workers to produce this wood, i was only going to make 19.58 USD, leading to a net loss of 10.52 USD. To put it more basically, for that day, i have a LOSS of 34%. With this knowledge, i began to do some research, and found that this amount of loss is actually NOT UNUSUAL in business' rated Q1-Q3, and in some cases, even Q4 and Q5 as well. This is an OBVIOUS detriment to businesses within the USA itself. We are competing with an import tax that allows the SAME amount of product to be produced in other countries at a FRACTION of the price, to be brought into the USA with MINIMAL fee's, and sold for current market prices, allowing this FOREIGN business' to INCREASE their profit. Just like in the real USA, it is becoming CONSIDERABLY cheaper for US citizens to build business' in other countries, and then import those same goods to the USA. This is taking money AWAY from the eUS, whether congress realizes it or not;
Here is a basic math breakdown;
At 5% federal taxes, a worker who makes 10 USD will pay the eUS government 0.50 USD every day for, lets say, 100 units of iron produced. So for one day, and 100 units of iron, one worker will pay the eUS 0.50 USD. This Iron is then sold, for a small profit, to a Q1 weapon producer, who ALSO has a single worker work for 1 day at 10 USD with a 5% fedtax to produce 100 units of Q1 weapons. The eUS government now has 1 USD for 100 Q1 weapons which will be purchased by americans. In this scenario, all funds used in the making of these Q1 weapons are kept entirely within the
eUSA.
Now then, for example, i will use spain as the counter to this.
Let us say that Spain has the same 5% wage, and i will translate everything into USD. A worker in spain gets paid 10 USD with a 5% tax, which goes to the SPANISH government, to produce 100 iron, then this is turned over for a profit for this spanish mogul to a Q1 weapons dealer, earning the SPANISH government another 0.50 USD, allowing the spanish government 1 USD. They then sell these Q1 weapons in the USA, paying the 1% import tax, netting the eUS government 1 USD. This means the eUS makes the same amount of money in both transactions. HOWEVER; in this process, we have allowed a FOREIGN country with a FOREIGN company run by a FOREIGN citizen to earn the entirety of the profit. This FOREIGN citizen can now use this profit to buy what he needs at the drastically deflated prices on the eUS market, further taking money and goods from the eUS.
All in all, the eUS makes the same amount of money in both cases. But only in the FIRST case do
eUS citizens really profit from the arrangement. All profit is going to spain (based on my example) as things stand right now. How is the fair to eUS citizens? Prices are low... sure, but there really is
no offset to that if we have to pay the difference in those low prices as wages for our own
AMERICAN based businesses.
Just like in the real USA, we need help our business' here at home, because in the long run, that is what is going to help the average eUS citizen. That is what is going to help our home grown
business' grow. That is what is going to allow the eUS citizen to see profit, and to grow as a player and a competitor in this game. As it stands right now, I want to sell my business, move to another
country, and try to build a business there and take advantage of the US low import taxes. This would be good for me, as a player, sure. But it wouldn't benefit the eUSA the slightest. So this is me, saying to my duly elected representitive. Raise those import taxes. Keep eUSA money IN the eUSA.
~Coup
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