eIreland taxed at the max and still broke
asecondchance
With our recent IA funding cuts due to our struggling economy report I was curious to the root cause of our inability to get a heads above water. This made me want to look into our tax structure to see how competitive it is with other nations of similar size. Our current tax system is:
I looked to compare us based on our eNation rank (currently 49) to similiar nations for their tax system so compare
😛South Korea, Paraguay, Bolivia, Belarus, Belgium, Netherlands, Republic of Moldova and Estonia.
Here is how those nations compare…
For Food:
For Weapons:
Summary for Food
Income Tax
Irelan
😛18%
Average of 8 Comparative nations: 8%
Import Tax
Irelan
😛50%
Average of 8 Comparative nations: 28%
VAT Tax
Irelan
😛20%
Average of 8 Comparative nations: 12%
Summary for Weapons
Income Tax
Irelan
😛18%
Average of 8 Comparative nations: 8%
Import Tax
Irelan
😛50%
Average of 8 Comparative nations: 22%
VAT Tax
Irelan
😛10%
Average of 8 Comparative nations: 9%
Summary is that eIreland has higher taxes in every category than any other comparable nation.
Our raising taxes were supposed to be a short term solution to getting over money that has become missing but as recent cuts are showing it is not solving the issue and we really need to consider returning our tax structure to a more reasonable and competitive form to allow for capitalism to prosper.
Comments
The weapons on your market are 20% more expensive than Poland and other major countries. No one is going to buy them at that price in sufficient volumes. Cut the tax and import a load of Q7 weapons to force the price down to a more globally competitive one.
The waters are muddied somewhat by the commune situation. A lot of players work in communes and get minimum wages because of it, which lowers the tax income significantly and many communes are based abroad anyway, because of the better resource bonuses. In an ideal eWorld, everyone who is eIrish would work in eIreland for market rates, which would help tax income for the government. This isn't an ideal world, though.
True but we aren't the only nation that has communes it is pretty common practice. Additionally by lowering taxes we give businesses more profits which means higher salaries and more money in the hands of our citizens to buy q7 weps or food themselves so that we can remove communes and government funded supplies.
@moff: We have low production with only one weapon resource bonus, so we lowering import rates will just ensure eIrish employers must shut down entirely.
Producing 12 tanks per Q7 factory worker will just never compete with Poland producing 20 per worker in a Q7 factory. They can afford to sell at a much reduced rate. It takes 9 workers in the best circumstances to produce a batch of tanks (8 Q5 WRM work clicks + 1 Q7 factory work click). One eIrish worker makes 1.33 tanks, at the most, per work click. A full-resource worker in another country makes 2.22 tanks per work click. That is 67% more productivity than eireland. If you want an even playing ground, the import rate should be at least 67%, but I would say it should go to 75% or even more, just to give eirish players a small advantage in their native homeland.
Just to break even, the market price minus tax needs to equal 1.33% your average wage. My average wage at the moment is 18.9 IEP. That means the break even point is selling tanks for 25.14 plus the 10% VAT would equal a 27.65 IEP market price... Nobody is going to pay that, and I would not expect any sane person to do so. The costs get mitigated by some WaM clicks, of course. By no means do WaM clicks account for doubling the production.
The market wages in some countries are still above 20. eIreland simply cannot compete with those wages and sell Q7s for less than roughly 10cc at the same time.
There needs to be some external factor that helps eIrish business owners. For example, OJ says he uses patrons that syphon money to him by paying exceedingly over fair market price for his goods. Colluding with people who have money to throw away is the only way to be profitable these days. I am not lucky enough to be liked by the kinds of people who do not care about their currency reserves for whatever reasons.
The absolute killer in all this is that all currencies have no exchange rates. With our currency being equal to countries like Poland, means we cannot compete with their productivity. It means low production bonuses will sentence your nation to financial death.
You say that it's giving Irish citizens an advantage but an advantage over whom? It only gives them an advantage over the Irish citizens who actually stick around to buy weapons. In my eyes this overly favours the producers over the consumers. This will only lead to consumers buying their weapons via the black market, or from a larger cheaper country such as Poland or the USA.
In addition to that you can't stop imports. High prices and high import taxes just gives the money to the middle man. Irish citizens who don't produce but move to say the USA buy a load in bulk and stick them on the home market.
I accept your points Bhane. The economy is a killer for all of us. Back during the days of Q6 I could make 3G + a day just from running my Q6 weapon companies. I'm probably lucky to make 0.3G a day from them now, and I know that it's even worse in other countries. Quite frequently recently producing Q7 weapons in even in poland has become unprofitable until the price of WRMs drops down another 0.01. The trouble is WRMs have now reach 0.04 and there isn't much further they can go.
10 uses to a Q7 really screwed up the game's productivity. As someone with a tonne of saltpeters even I'm beginning to think the admins should remove work as manager or come up with some other idea. Right now we seem to be stuck in a period of crippling deflation.
1. Ireland has no bonuses of note.
2. Ireland has significant numbers of commune workers.
3. The only reason we were doing well before wasn't because of taxes, but because of big donations, a better Monetary Market to exploit, etc.
4. Lowering taxes would cripple both government revenue and our continued military capability.
inb4someonefindsawaytomakethispersonal
Nice article. Finally a little substance in our media.
import taxes should be kept high to exclude foreigners with irish market licenses. I have a netherland license. Their Q7 weapon prices there is 13.50 . Per unit its 7.50 . So even if I buy cheap I cannot sell there. Then everyone that is using the buy there sell here tactic should come up with a acceptable quota. I see guys there regularly with 1000 Q7 weapons that sell. Our combined use cannot be more than 10 weapons per citizen so that would be about 3000. Yes you can go for the full price and if you have corrupt backers like OJ you can still sell for more but buyinbg huge quantities in the end means taking a knock not making a profit. Thats why I propose a quota. I dont think there is any player producing more than 100 weapons a day so that would be around about right.
in countries with low boni you can't compete with countries with high boni. so you will always have people who are travelling to buy cheap
maybe the only way to make some money for the state is to tax the patriots who still produce and sell/buy in the country - because all who buy where it is cheapest won't buy in ireland even if tax are low as long as it is not the cheapest deal...
so the way to go is low import but higher VAT. because of the higher VAT people with homemarket in ireland will be taxed too if they try to make money with cheaper weapons from abroad (because they can't evade the VAT like the import-tax). and importers from abroad with irish licence won't flood the market because what is important for them is the sum of the taxes not just the level of import-tax and as long as the sum is high enough they will be kept outside
too boring didn't rea😛
what you could try is to tax the homemarket importers and the patriots a bit more with a bit higher VAT. and just to mention it because sometimes it sounds like the only way to keep out importers is through high import tax: to keep foreign importers outside the sum of the taxes is of interest
+ read this please:
http://www.erepublik.com/en/article/treasury-income-in-various-countries-2192241/1/20
*insert Laffer curve here*
I still think its unfair that our government expects free market workers to pay 100% of the taxes while commune workers continue to evade tax.
well believe me commune has nothing to do with all this situation, all we need is maybe little lower taxes, and yes less expensive weps, so we get more buyers...
Ian E Coleman, there is no way to force communes to pay taxes, and under no circumstances would I make them do so anyway. Self-sustaining community is to be encouraged.