The X tax is an approach to taxation, suggested in the United States, that can be described as a standard European-style credit-invoice value added tax (VAT), except that wages are deducted by businesses and taxed at progressive rates to workers. Businesses are taxed on gross receipts and individuals taxed on wages, with neither businesses or individuals paying tax on financial transactions or financial instruments. The plan was created by Princeton University economist and New York University School of Law professor David F. Bradford.
Bradford states the X tax could alleviate the complexities and avoidance issues plaguing the existing U.S. system, and argues that "the government should exempt from taxation all dividends, interest, and other income from savings. That way, people will be treated equally by the tax system, whether they choose to spend now or save to increase their future spending power."
Famous quotes containing the word tax:
“I have no doubt that it was a principle they fought for, as much as our ancestors, and not to avoid a three-penny tax on their tea; and the results of this battle will be as important and memorable to those whom it concerns as those of the battle of Bunker Hill, at least.”
—Henry David Thoreau (1817–1862)