Economics by L. Ron Hubbard - On Economics - L. Ron Hubbard Humanitarian: Freedom Fighter

About the turn of the century, most Western nations gladly swallowed this potion and wrote income tax laws.

In a letter written by the Treasury of a great nation, a question as to why income tax was levied so unequally instead of on merely a set percentage of everyone’s gross income was answered with the astounding datum that taxation of one’s net income, and on a sliding scale, was far more humanitarian.

Inflation is the order of the day. Few Western governments take any but inflationary actions—to wit, to devaluate the buying power of money by spending more money than there is produce to absorb it.

Income tax is arranged so that the more one is paid, the more percentage he is taxed. For a crude example, if one makes 500 monetary units a year, his tax is 2%. If he makes 100,000 monetary units a year, the law is so written that his tax is about 90%. The more one makes, the more one has to pay in proportion.

Very well, let us use this as hours of work. In a low income bracket on a forty-hour week, one pays the government a half-hour’s work a week. In a middle income bracket, one pays the government twenty out of forty hours as tax.

All right, inflation willy-nilly is shoving the lowest worker toward the higher tax bracket.

The price of bread and rent and all will go up proportionate to the value of money. So will his pay. But his tax will increase.

Therefore, governments are very anxious to inflate their money. The more it inflates, the more workers have to be paid but the more percentage the government gets of the work hours.

The end product is, of course, a total state. Industry cannot pay a worker 40,000 monetary units if tax laws take all but 5,000 monetary units.

If you will look at taxation schedules you will see that if a loaf of bread cost ten times its current price and you had other costs rising proportionately, your pay would shrink to where you could not afford to eat because the higher tax percentage would engulf your pay, no matter what it was.

Now, no one has been mentioning this. And governments defend their right to a rising percentage, as income rises with a tenacity that is quite surprising.

Every time your pay rises to take care of the “rising cost of living,” you then expend more work hours for the government and less for your employer and finally he goes broke too.

Anyone trying to say that inflation is inevitable and income tax vital is simply suppressive or stupid. Surely the big wheels of government economics know as well as any other trained economist that all one needs to do to check inflation is increase production and decrease government spending.

One Western nation has a lovely one going. “Export the goods!” is the cry. The more goods exported, the less there is to buy. By currency exchange laws, one cannot also export the money. A prohibitive duty is put on all imports. Naturally, inflation! With a vengeance. And this is coupled with an income tax which is easily the highest in the world.

L. Ron Hubbard Der Menschenfreund - Freiheitskämpfer
L. Ronald Hubbard El Filántropo - Paladín de la Libertad
L. Ron Hubbard Le Philanthrope - Défenseur de la Liberté
L. Ron Hubbard L'umanitario - Paladino della Libertá

© 1997-2004 Church of Scientology International. All Rights Reserved. For Trademark Information

© 1997-2004 Church of Scientology International. All Rights Reserved.
For Trademark Information