Please change the movie on tax

After enduring endless debates about sales and services tax (SST) versus the goods and services tax (GST) during pre-budget season, it's time to consider a more efficient alternative. Former politicians and so-called tax experts tout GST as superior to SST, simply because it raises more government revenue. However, this is a regressive tax that disproportionately burdens the poor.

Just like a "black hair tax," GST is preferable to a "ginger hair tax" – something no one would willingly pay. The truth is that businesses never truly pay GST, as they claim it back. Former politicians know this, but they continue to push for GST, hoping to remain relevant.

Tax experts argue that if SST were more like GST, it would be more efficient. But they are deceiving themselves and the public. The solution is an electronic payments tax, or EPT, which would be a small charge on all electronic payments, regardless of the type. This would replace complex income and consumption taxes with a straightforward levy collected directly through the banking system, eliminating the need for tax filings and reducing compliance and administrative costs to near zero.

An EPT would have a broad base, encompassing around 18.4 billion retail transactions annually. This low tax rate could still generate significant revenue without causing people to change their behavior. Weighed down by wealthier individuals and large corporations, the tax would be inherently progressive, while tax evasion would be virtually impossible due to automated electronic trails.

The government would benefit from unparalleled fiscal stability and predictability, with funds collected and sent to the ministry of finance instantly with each transaction. So, let's put an end to the outdated tax debates of the 1970s and embrace the digital era of the 21st century with an EPT.