Currency Usage Tax (CUT)
Introduction

     My Currency Usage Tax eliminates all current federal and state revenue sources and will pay off the $34 trillion federal debt in less than 5 years.   Eliminating income tax and payroll taxes not only increases a worker’s spending power but will provide them with a greater opportunity to invest and save.   Eliminating property taxes means you can pay off your home or business sooner, and the government no longer has the power to take your property through taxation.   Eliminating all small business taxes and fees affords them the opportunity to hire more people, pay better wages, and provide more goods and services.   Eliminating corporate taxes will likewise allow corporations to hire more workers, increase salaries, improve inventories, and create more products at a lower cost.   The numerous U.S. companies that prefer to do business or have moved their headquarters overseas because of America’s high corporate tax rate will eagerly come back, and companies from around the world will want to join them.
      The Currency Usage Tax returns taxation to its Constitutional mandate that all taxation will be based on economic productivity, and it must be uniform throughout the United States.   Cut is a single flat tax that utilizes a simple more efficient revenue process.   The CUT is based on the Federal Reserve’s Normal Daily Aggregate report of U.S. Dollar Funding Flows.   In America, $7.5 trillion flows through the U.S. economy each day.   That number is $20 trillion in the world economy.   Utilizing a 1% tax on the $7.5 trillion will produce a revenue stream of $75 billion per day which equates to more than $27 trillion per year.   Unlike previous tax laws, there will be an inviolable maximum 1% consumption tax on dollar funding flows.

How the CUT Works

     Every existing federal, state, county, and municipal tax and fee will be eliminated.   States no longer collect income, property, or sales taxes.   Employers are no longer required to withhold Federal Income, Medicare, and Social Security taxes for their employees.   Also, employers are no longer required to pay the Federal Unemployment Tax.   However, employers are required to withhold 1% for the Currency Usage Tax.   Every type of business financial transaction is taxed at 1%.   Every monetary transaction within the U.S. economic system is taxed at 1%, except intrabank transfers between family member’s bank accounts within the same bank.
CUT Example:
      Due to an increase in demand, a business takes out a $250,000 loan to improve inventories and hire more workers to sell more of their product.   When the business receives the loan the tax paid is $2,500.   The business spends $100,000 on their inventory and the tax was $1,000.   When workers receive their paycheck, they are taxed at 1%. If the worker’s yearly earnings are $50,000, their tax is only $500.   However, every time the worker pays a bill or makes a purchase, those transactions are also taxed at 1%.   That is still only an overall tax of 2% on American workers as compared to the 40-60% we all currently pay for state and federal taxes.   Everyone in America would pay the same fair flat tax of 1% for their monetary transactions.

CUT Revenue for Government

      If all state and federal taxes are eliminated, how in the world will they pay their bills?   As mentioned, the Currency Usage Tax generates more than $27 trillion in revenue annually.   $10 trillion each year will go toward paying off the federal debt until it is paid in full.   $5 trillion will be provided to the states and distributed based on their citizen population.   This amount is $1.5 trillion in excess of typical state budgets.   States may use their reserve funds to pay off their debts and liabilities.   $10 trillion of the remaining $12 trillion is provided to the federal government to appropriately fund federal agencies and for desperately needed infrastructure improvements.   $2 trillion will be held in reserve by the Federal Monitoring Service (FMS).   The Currency Usage Tax generates significantly more revenue than any previous U.S. tax structure.   When the $34 trillion federal debt is paid in full, the CUT can be reduced as state and federal funding dictates.
      The Federal Monitoring Service replaces the IRS as a federal agency within the Department of Treasury to collect all CUT revenue and maintain oversight of its proper allocation and distribution.   While some people may be disappointed with the elimination of the IRS, be assured that its personnel and resources will be properly utilized.   The IRS will be transformed to assist Americans with their benefit programs as part of the Federal Monitoring Service and State Management System.   The resources of the former IRS will be used by FMS and SMS to monitor and manage USCF programs while preventing Fraud, Waste, and Abuse.   The CUT and USCF work together to solve numerous issues Americans have endured with regard to the IRS, welfare, entitlement programs, education, healthcare, livable wage, retirement, crime, justice, and much more.   USCF solves America’s problems utilizing sound reform that holds government accountable to increase efficiency and eliminate bureaucracy while improving quality and reducing overall expenses.

Why The CUT Is Needed Now

      Mandatory spending on welfare and entitlement programs as a percentage of the federal budget has more than doubled since 2010 with Medicaid and Medicare leading the way.   The out-of-control cycle of the federal government’s spending and borrowing against our future by printing money is why recessions are more frequent and more severe.   Recessions are not a result of Capitalism but the Fed’s decision-making process.   When the federal government has no money to fix any of America’s problems and politicians relentlessly waste tax dollars, it becomes obvious that they don’t care about us.   When a serious event like the pandemic does occur, the Feds have no recourse other than printing $6.4 trillion over 2 years and adding that to the federal debt.   We must come together to solve America’s problems and we must start by paying down the $34 trillion federal debt.   My Currency Usage Tax is the only way we can pay off the debt, restore liabilities, and ensure Medicare and Social Security remain solvent.
Read about The Issues we need to fix in America.
Return to the United States Citizen Fund (USCF).