Work Tax Failure!
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by OLloyd
So many complaints on work tax...How is it figured and how does it effect you?
If you work as a manager you are currently paying $3.71 per company you work! For some of us that is a lot, for others it isn't. Lets do some math and prove that the work tax is broken.
Example 1. Q3 Weapons Company. Produces 16 units and requires 480 wRm. A Q4 weapon raw company will cost you $3.71 to produce 280 wRm. So you need to work 2 to have enough wRm to make your 16 units. So to make those 16 units you need to pay $11.13 in work tax to produce. How much does each unit cost to produce you ask? Each unit cost $0.695 ($.70) to produce...how much do they currently sell for? $.17 a piece! Well, what if I bought the wRm...then it will cost you $1.13 per unit to produce because wRm's cost $.03 each plus your $3.71 work tax to run your company.
Example 2. Q3 Food Company. Produces 200 units and requires 600 wRm. A Q4 fRm makes 350 units. Producing all mats yourself the total cost per unit is $0.055 ($0.06) If you purchase the fRm at $0.02 a piece will put the end unit cost at $0.078 ($0.0😎
. The current price for Q3 Food is $0.17 So there is some profit in making food.
I am not sure what the amounts of raw materials are needed to make Q6&Q7's are, but really, it's probably proportional.
So how do we fix a the work tax being such a signficant effect on our production of goods? Easy lower ALL wages and pay your employees eCash! If the average wage was $5 instead of $37.14 then we would only be paying $0.50 per managed company...Which would make the cost to produce those Q3 weapons $0.09 per unit! They become profitable again. And if the work tax was lowered to 5% then the Q3 weapons would cost $0.35 and if it were just 1% it would cost $0.07 a unit.
The next problem that needs solved is product flooding. How can you sell your stuff when the Import Tax is 1% That means that the guy in eArmenia can pay 10 gold and then sell his goods to us for much less than it costs us to produce it. Do we want that? I know players want cheap goods, but if we are paying for wars why not increase our Import Taxes to make it harder for our enemies to flood our market with cheap goods!
With our eNation being what it is, we should be heavily supporting our eCanadian companies! Especially since the CP has said that he is trying to get the MUs back to working. If that's the case we will be Work Taxing the slave pit operators which will require the eGovernement to subsidize the pits in one way or another. Why not just lower the Work Tax to 1% and find other ways to collect money to wage wars. Increase the VAT on food and weapons. When it comes to monitary policy we need our congressmen/women and CP to do the math before posting a vote. Support the war machine and lower Work Tax and Increase Import Taxes! Cheap to produce food and weapons will let us fight more!
Lets all play the game smarter!
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It's true that the Work Tax does have a negative impact on production costs, especially for lower quality companies (though for anyone thinking that it's worth investing in higher quality companies to avoid paying as much tax, I strongly encourage you to do the math on how long the upgrade would take to pay for itself). A higher VAT would also take money from producers, though.
The problem is that we're broke. If we were to reduce the average way, as you suggest, we'd still need money so we'd likely need to raise taxes higher still.
I also don't see a need to lower import taxes. Are we really that worried about Armenians? Why would anyone pay 10 gold to make possible pennies more (and likely less) by selling here? Our prices are about the same as anywhere else and we don't have heavy turnover either. Even if we did have higher prices, I think it'd be better to have foreign pressure to push prices down to the world average to save consumers some money.
I've said this before but I'm really not all that concerned for Canadian producers. If you're doing it for the money, you're a bad businessman. Making a return on your investment takes years now. If you're really in it for the money you're better off dissolving your companies and living like a rich man for a few years rather than worrying about paying an extra few bucks (0.01 gold!) per company.
That said, I agree that we should be looking for another sustainable source of income. If our ~$1,500 per day tax haul continues for a month we'll earn about 1,575 gold a month. That's 315 medals. If we could we convince half our population to donate the proceeds of one medal a month we could double our income. Is it likely to convince that many people? Maybe not but I think we could get there on average with some people donating more than others.
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"I also don't see a need to lower import taxes. Are we really that worried about Armenians? Why would anyone pay 10 gold to make possible pennies more (and likely less) by selling here?"
It doesn't matter WHY they do, what matters is they ARE.
This is a very simplistic view for several reasons. I just took a quick look at q7 weapons on the first page. Now this is just a snapshot of right now at this moment, so not necessarily indicative of what happens the entire month, but I have seen these people selling often so a more in depth sudy would probably be needed..
40% of the first page are importers
total products for sale 3623
Total foreign product 1887 or 52%
total value of the product for sale is $25,992
total value of the products for sale by foreigners is $13,339 or 51%
So on over 1/2 the products sold, Canada is collecting no work tax because they are being collected on their end.
50% of sales are a net outflow of capital to other countries which means less investment in infrastructure here
Take into account a lower work tax on their end (in most cases 50% less) and only a 1% import tax, they are making more than home producers are.
And all that money is only being taxed at 1% where in most cases home producers are being charged double the work tax they are paying.
If you want to at least even the playing field for your home producers, the import tax should be raised to a minimum of 5%, or a combination of a lower work tax and higher import tax. pick your poison.
The eArmenians were just an example of an eNation that had 1% work tax. The ePolish and eSerbs flooded our markets many times before we got whipped. We protect ourselves against PTO attempts, but our eGov doesn't even think that our finances are something to be protected. We could pick up a good deal of coin if we raised our import taxes to 5%,.
I'm with them, OLloyd. I don't worry about anyone who's spent hundreds of gold for a Q7 weapons company. I'm not looking to even the playing field. On the other hand I care about the soldiers who need to buy those weapons to fight.
I think your analysis is about right, the grinch. I only have two quibbles.
1) There are many reasons why a foreigner might be making more money than a local producer such as bonus regions.
2) Looking at the entire first page is also simplistic. Prices for Q7s currently range from $7.09 to $7.99. It's more important to look at the cheapest items for sale, the ones people would actually buy. Currently that's six offers between $7.09 and, generously, $7.23. The cheapest three offers at are 600 at $7.09, 82 at $7.10 and 1000 at $7.11 are from foreigners. The Canadians are selling 447 and 400 at $7.20 and 200 at $7.23.
So it seems to me like the import tax is doing it's job. It's keeping high stocks at lower prices, closer to the average elsewhere, available for sale in Canada so that we don't have to travel abroad which many people would do otherwise.
Without those sellers our prices would be about 20 cents above the world average (~3😵 and there'd only be about 1000 on sale before prices rose to $7.53!
Now if our prices were lower than what's available elsewhere then I'd be willing to reconsider but even then if people were willing to undersell us, I'd say snap up the goods.
Foreigners aren't what killed the economy and neither are taxes.
I think that everyone should be sustainable in the food side of things. Obviously the weapons side, the game developers have punted. You will make your money back slowly. Realistically, its more of an investment in your sustainablity future.
When it comes to import taxes, they need to be higher. Many players have been citizens in more than one eNation. The smart way to break a nation before you take them into a whipe is to flood their markets and make it hard for them to sell their surplus goods and overall lower the value of their things. So that they are a softer target. The Serbs did that to us a couple years ago, just before a PTO that was rather successful. Its a stratigic plan that may or may not work as well as it once did. But really do we want to get our markets flooded? I know that some communes are still working, but I would bet that there are more players using the pay as you go system since our MUs are not as powerful as they once were.
Getting players to donate more would be a better option instead of raising taxes. The work tax is not sustainable. Especially for communes and MU's that have slave pits. That is just costing our working active citizens money that isn't necessary. Remember that the tax hits those with multiple companies not the everyday man. The everyday man, there are not enough working one job that would make the tax pay, its the manager work that is and will drive players to change how they use those companies with a high work tax.
And Chochi is right, we should not run businesses to make money, but we should not run businesses to dump money into the government. If we want the government to have more money there is a donate option at the My Country page. When the government is taking more than the product is worth there is a real problem, and who employs people to lose money. There is a balance you have to make as a player.
I have personally made enough money to buy the Q7 tanks I need and then turn the rest into gold to upgrade companies and training, before the Work Tax got out of hand.
Find that balance is getting tougher as we lose more players. If we could live off of donations then, yeah, we wouldn't need to have such high taxes and those players who only have companies that are now taxed out of business could open up shop again. But we currently aren't seeing the cash needed donated to the Treasury. Can the government turn that around?
I'm not sure that economic warfare is possible in this day and age. With margins so small and prices within such a tight margin worldwide (with our one global currency) our enemies would actually be doing us a favour if they flooded our market, even with just a 1% import tax, if others noticed and came to buy their stuff here.
As for food, again I think we shouldn't worry too much about sustainability there because of the long ROI. It'd be better if we pooled our gold together to set up Q7 communes overseas. It's now sustainable to produce Q1 house companies for soldiers and 30 weapons for each a day (or also Q2 houses but less weapons) plus whatever can be produced from paid employees. But the infrastructure costs are still pretty high, especially if we want to WAM the WRM.
Does anyone actually sell anything here? Must stuff just sits on the marker forever. Import tax's are pointless. If you look at small countries with high import tax's no one is selling and no one is buying. It is a complete joke.
I think we should consider a higher VAT. Everyone pays the VAT including foreigners who want to sell on our market.
They broke the econ module long before they broke the eGov module...Congress and the election process is more of a joke...
Before the work tax got raised and I stopped WAM'ing I would sell my WRM every week or so by undercutting the market by a penny, and taking a small hit but still turning a but of profit to keep me going.
I can't do that anymore. That margin for error is gone. So do I keep WAM'ing so the government gets their piece, then sell and basically break even on the hundreds of CAD a day in Work Tax I'm paying?
Nope. I just stopped pushing the button all together.
I just sold back to the game all my wRm companies and i picked up a couple more fRm cause there is still some profit in that. I also sold every Raw company that was Q1,2,and 3. The only ones that make sense are the Q4's CAD to buy and give you the most mats for the money. I saw it as an investment in my future sustainability. wRm companies have never really been profitable, especially since the weapons companies are low producers.
Unless I did the math wrong, I think Q5 RM companies are still the better investment.
You pay 20 gold for a market license.
When did the game change that? Last one I bought was only 10g...but I was a US citizen when I purchased the US license.
Don't know when it changed, but it did. Maybe it's less when you're a citizen of the country?
It's 20 gold now? I guess there really are a lot of idiots out there. Or otherwise people bought them when they were cheaper (and maybe are still looking to recoup their costs?).
it is not less if you are a citizen. You are given one market licence now, in the nation you are eBorn into. Then you have to buy any other licence, even if you change citizenship.
It changed over a year ago
You should never make less than Q6 weapon WAM. Q7 is of course better but there's a large gold gap to do that. If you're not making at least Q6, you're better off not working it even if the work tax was at the minimum level of 1%. the higher quality weapons both do more damage and last longer too - which is why almost no one buys anything other than Q7 (Q6 for personal use is decent, which is why I'd say thats ok to WAM, if you're just supplying yourself)
Food doesn't matter. There's not much advantage to upgrading food factories except for saving space in storage.
Changing the import tax made no sense at all, especially if we wanted to raise revenue (the rare import makes a lot more revenue for us at 99% than it does at 1%. We certainly aren't importing 100 times more goods to make up the difference, since essentially nothing sells on the market. License fees are so high that almost no one ever buys any.
Anyway, the only solution to the tax being too high is to not work. It's not likely to go back down any time soon.
I suggest we work smarter, get rid of the companies that don't break even. The game has broken part of our economy our eGov has done the rest with these high work taxes. And Plato ruined Congress when they changed the way we elect congress.
I miss the days when Congress elections were regionalized.
Regional elections were more fun but I think the "new" version is more democratic. Not that that even matters anymore with the dictator model and the fact that nobody even shows up to run for Congress anymore.
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I'm still having trouble with the reply system.
Lowering the import tax was not necessarily about raising more revenue but about bringing in more suppliers and lowering prices as a result.
That said, were any foreigners selling here when we had high import taxes? If they weren't and are now then we would be making more money through the lower import tax.
The number would have to be 99 times greater than before to increase revenue. Either way, we're comparing infinitesimally small numbers. No one is going to invest 20 gold to sell in Canada for a profit of pennies. The only people it benefits are people who already had Canadian permits, but left Canada (and therefore don't pay our WT). Mainly communes, I'm guessing. I don't know who was pushing DMV to demand that plank, but it wasn't about improving Canada's economy, that's for damn sure. "Canadians pay double, foreigners pay nothing."
doubling of the work tax rate has pretty well doubled the revenue from the work tax. Think about what that signifies. Possibly, players are considering not WAMing but haven't yet taken action. Alternatively, the change doesn't significantly affect many players.
In order to have a fruitful discussion it would be good to appreciate why eCanada has a population of about 600. About 200 vote. Possibly, the other 400 are real life individuals committed to the welfare of the eCanadian community but not politically minded. Alternatively......
Alternatively Klop now has 400 multi's?
My math suggests that work has declined by about 8%. That's a lot smaller of a decline than I expected (I figured the post-10% revenues would be below 15k, possibly even below 14k). Either a lot of people are not checking, or not caring. In either case, might as well go to 25% - even with a near doubling of revenue, it's obviously not enough for war-at-any-price.
Clearly caused by global warming, don't blame the tax rate.
blame harper
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