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I am running for Congress in New Jersey! I need your support to help make eUSA flexable enough to survive the coming changes to eRepublik!

Why should you elect Robert Renolds? Because he has good ideas.
Right now, eUSA, and all of eRepublik, is at a crossroads. We need real leadership and new ideas to weather the coming changes from the eRep Admins.

First and foremost, eUSA needs to change its tax structure:
We need more VAT, less income tax!

Why is VAT better than income tax? Lets take a look:

Income tax only hits when a citizen earns income. By definition it is limited to only the citizens of the country. This decreases the purchasing power of the citizens, and that effects GDP directly as it limits the average amount earned per day. This is a sort of catch 22.

VAT hits on ANY purchase. Including FOREIGN goods sold here. Any outflow of cash is now taxable, a previously untouchable revenue source. VAT also taps into the "free money" coming from the "mystery buyer" (aka roboAdmins) a previously untouchable revenue source. Additionally, an increase in VAT and a decrease in Income Tax increases spending power, thus GDP.

Another big point is that a VAT gives the government a discount on its purchases. Interestingly enough, it gives the government a purchasing power GREATER than the VAT tax rate itself. How? Like this:

VAT in GOV'T B is 20%
GOV'T B buys $2000 of $20 a piece (VAT included) weapons. That's 100 weapons. Each weapon actually costs GOV'T B only $16.65, as $3.35 is returned through the VAT. So GOV'T B can now buy another $335 worth of goods. But wait! On the next purchase, GOV'T B will get $67 back, allowing purchase of another $67. In doing so, GOV'T B will gain another $13.40, which is available for later purchases. . . see the pattern? GOV'T B gets a 22% increase in purchasing power, 2% more than the rate of the VAT! GOV'T B has gained 2% more "revenue", due to the increase in purchasing power. This happens on any good, foreign or domestic.

So lets review;
Income can only draw money from the citizens. This decreases GDP.
VAT opens up new revenue sources: *Foreign goods, the mystery buyer
VAT allows Governments a purchasing power increase at a rate higher than the VAT tax.