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Paul R. Bottis Sr
Worcester, MA 01604
(thru BATR's YAHOO Group)
July 4, 2002

The essence of the Transaction tax/user fee is that it is not a tax upon any commodity or real property. It is a small fee paid for using the currency of the United States. It does not tax the money a person or entity has until the money is moved. To the worker it amounts to a fee of one dollar for each one thousand dollars earned or spent. Under the existing tax code a taxpayer who earns forty five thousand dollars a year is taxed over four thousand dollars. Under the "user fee" he would pay a maximum of ninety dollars if he spent all the money he earned. If he did not spend it all he would pay no tax on the money that remains in the bank. This concept will derive revenues in proportion to the wealth a person uses not the wealth he has.

The explicit purpose of this Web Page is to give those who visit it a knowledge of a concept that could, if used as an alternative to the present system of taxation provide a single tax replace all of the taxes collected by the Federal, State, and Local governments combined. The present systems were enacted into law to fit the needs of times that have no relevance to the technology or the needs of the age we are now entering.

There are no commercial ads or personal opinions, philosophies, or solicitations to be found here. All of the information is for the purpose of substantiating one simple conclusion built upon the facts presented that it is better to Tax Money Not People. You will not be asked to join any organization or receive a request for donations. The only thing you are asked to do if you are in agreement with the conclusion, spread this concept to others. The ones who will gain the most are middle class taxpayers. The only ones who would pay more under this concept would be those individuals and corporate entities that do not pay any tax under the existing tax code. One example would be Enron who did not pay any taxes in four out of the last five years before it went into bankruptcy. The opening paragraph explains the advantage to the average taxpayer who paid more in taxes than did Enron.

The proposed law is as follows:

A tax of one-tenth of one percent more or less shall be levied on all transactions having a monetary value.


All transactions either in cash, checks, electronic transfers, credit lines, transfers of goods or properties, stock certificates, securities, transfers of assets between business entities etc.


No exemptions to any individual, corporation, or agency including governmental, quasi-governmental entities, nonprofit corporations, fraternal or religious institutions. Cash transactions of less than $1,000.00 would not be taxed.

The seventy three words of this law would replace the entire IRS Tax Code (26 USC) that contains 2.8 million words used to administer, collect, and regulate the provision of the 16th Amendment to the Constitution containing only 30 words.

Amendment XVI

The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several states, and without regard to any census or enumeration.


A Structure will topple over if it grows too large relative to its weight. The same is true with institutions that grow to a size where they cannot be effectively managed, controlled, or fulfill the function for which they are created. This is certainly true of the IRS the agency designated to collected the revenues generated by the IRS Tax Code (26 USC).

There has never been a piece of legislation that has had its provisions change with every new session of Congress this year there are 400 of them. Nearly every bill passed by congress has an effect upon the tax code. Much of the lobbying efforts of special interest groups are geared to convince Congress that a new provision should be inserted in the tax code or an old one eliminated.

The method to collect revenues makes every individual and every business firm a tax collector who must determine how much money they owe and it is their responsibility to remit any money over and above the deductions from their pay checks by their employers. The employers must remit the withheld wages quarterly along with their share of the FICA and the tax on profits that they have made, plus the tax on any capital gains.

The time spent by individuals to make the returns due by 4/15 each year is no mere annoyance to them. However, the cost of filling out the required forms for the giant corporations such as EXXON, General Motors, General Electric, Microsoft, etc requires them to hire huge staffs of tax lawyers, CPAs, resulting in tax forms that measure 3 or more feet high. The IRS does not have the capacity to audit any of the large corporate returns they depend on the integrity of the CPAs, Lawyers, etc. and are forced to trust that the forms are accurate and honest. They audit the forms of those individuals and businesses that are at lower end of complexity, and they audit only 1% in an average year.

The IRS practice of using the taxpayers as the tax collectors has led to widespread evasion and abuse. The estimates as to how much is lost in revenues due to evasion vary greatly. However, because of the immensity of number of returns whatever the figure cited it can only be speculative. A search of the statistics on the IRS URL will enlighten and dispel any doubts about the problem. The collection procedure is further acerbated because we have been in a global economy for many years. The speculative movements of money and the movement of money to hide profits, show profits, launder money, evade taxes, whatever the purpose may be there is no way that the activity can be traced. If the IRS cannot examine written forms, the transactions on a world wide web are beyond their reach or purview.

Trying to remedy the situation by reforming systems that are obsolete and outdated is an impossibility that would only serve the purpose of those who will not relinquish the benefits they receive from the IRS Tax Code (25 USC) a monstrosity that was created by their influence and control of the legislature. However, the very things that are destroying the old can be used as the building blocks for the new.

When President Nixon wanted to fund the Vietnam War he realized that because the United States was committed to support and maintain the price of gold At $35.00 an ounce there was not enough money to fund the war. He recalled all the currency that up to that time was backed by the gold the United States had in Ft. Knox Kentucky. The dollar up to that time was the standard by which all the worlds currencies were pegged. Since that time they were left to float against each other. Leo Lamed the head of the Chicago futures market that dealt in commodities saw an opportunity to start trading in currencies. He needed some support that would influence the SEC so he went to a friend Milton Friedman former head of the Federal Reserve Board of Governors and paid Mr. Friedman $5,000.00 to write a paper in support of his idea. The rest is history the money market has soared into the billions of dollars daily. This phenomenal growth of money in the futures market combined with the money in the other markets Dow Jones, NASDAQ. NYSE, etc. and all of the money that is transacted through the FED an amount that exceeds 550trillion each year. If used as a tax base could generate revenues with a minuscule tax rate. With a rate of only one-tenth of one percent it would raise more than all the Federal, State, and Local taxes combined. It could become a single tax to replace all the others.


The United States Congress took the first steps that led to its domination by a private for profit banking system with the passage of the Federal Reserve Act in 1913, in which it delegated the powers that inherently belonged to them. Article 1. Sect. 8 - The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States; 2 To borrow Money on the credit of the United States; 3 To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes; 4 To establish an uniform Rule of Naturalization, and uniform Laws on the subject of Bankruptcies throughout the United States; 5 To coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard eights and Measures; ….Britannica


"…Created by the Federal Reserve Act of 1913, the system consists of the Board of Governors of the Federal Reserve System, the 12 Federal Reserve banks, the Federal Open Market Committee, the Federal Advisory Council, and, since 1976, a Consumer Advisory Council; there are several thousand member banks. The Board of Governors of the Federal Reserve System determines the reserve requirements of the member banks within statutory limits, reviews and determines the discount rates established by the 12 Federal Reserve banks, and reviews the budgets of the reserve banks. A Federal Reserve bank is a privately owned corporation established pursuant to the Federal Reserve Act to serve the public interest; it is governed by a board of nine directors, six of whom are elected by the member banks and three of whom are appointed by the Board of Governors of the Federal Reserve System. The Federal Reserve banks are located in Boston, New York, Philadelphia, Chicago, and San Francisco, and also in Cleveland, Ohio; Richmond, Va.; Atlanta, Ga.; St. Louis, Mo.; Minneapolis, Minn.; Kansas City, Mo.; and Dallas, Texas. The Federal Open Market Committee, consisting of the seven members of the Board of Governors and five members elected by the Federal Reserve banks, is responsible for the determination of Federal Reserve bank policy in the purchase and sale of securities on the open market. The Federal Advisory Council, whose role is purely advisory, consists of 12 members, one of whom is elected by the board of directors of each of the Federal Reserve districts. All national banks are required to be members of the Federal Reserve System, …" Britannica.

The Board of Governors is an Agency of the government all of whom are appointees with no direct connection to the electorate. It is this agency that Congress used to give legitimacy to their actions. The government continued to Coin the Money at the mints and printed the currency at The United States Printing Office. However, once the money was turned over to the FED Board of Governors it has no more control over it. The Board of Governors pays the Treasury the cost of printing the notes about 3 or 4 cents regardless of denomination. They in turn sell the notes to the member banks for face value. When the government needs to borrow money to fund the shortfall in the budget it is in reality creating money not borrowing it as one might think.

Government borrowing in the strict sense includes only borrowing from the private sector of the economy--from individuals, corporations, and various financial institutions, including banks. When the government obtains its funds from the central bank (the Bank of England, the Bank of Italy, the Bank of Japan, or the Federal Reserve System in the United States), it is really creating money rather than borrowing it, since the purchasing power is made by the central bank and no obligations to the public are created.When a government borrows, funds are transferred from the lender to the government, the lender exchanging his money for government securities. The effect is to reduce the liquidity of the lender--his command over cash--to an extent dependent upon the nature of the securities. The reduction in liquidity is small with short-term securities and greatest with nonsalable, nonredeemable securities--a type seldom issued except in time of war or other crises that create financial emergencies.____Brittanica

The money that the government sold to the FED Board of Governors four 4 cents a note now must be borrowed back from the FED member banks at face value plus interest. The folly of this practice has put the government into debt to all who purchase any kind of government financial instrument be it Bonds, Treasury notes, etc. The total of these debts at the time of this writing is $6,085,328,027,418.02 . This includes the money borrowed from the Social Security and Medicare and other Trust Funds. As the article from Britannica points out when the financial instrument is bought from the government it creates money it does this through the Fractional Reserve Banking Practice the FED uses. It is through this means that the banks create money, when a bank receives a deposit it must keep a certain amount in what is called required reserves these are usually held in the Federal Reserve Bank. If for example the required reserve is $2,000.00 on a $10.000.00 deposit it means that the bank can then write checks and lend out the remaining $8,000.00 dollars and the potential is that it could create as much as $50,000.00 plus the $10,000.00 dollar deposit on its books. All the checks the banks write are creating money that never existed before. The money that makes billions for the bankers and the corporations and puts the government into debt.

Is there an answer out of this dilemma? Yes there is a rather simple answer. It is to require the banks to pay a fee for all the money that they create by debiting a "user fee" on this fiat money just as they charge a nominal fee for the currency. Congress has the power under Article 1. Section 8: of the Constitution to charge a fee to the banks for using the currency in any form. A fee of only one-tenth of one percent debited at the time of the transaction would generate $1,billion for each $1,trillion in transactions. What would be the result of this? It would be far reaching, first it would take the government out of debt and out of the control of the bankers. It would require the bankers to stand on their own with out involvement from the government.

The government then would have a steady flow of funds to restore it to the function of serving the people instead of corporate interests. It would have all the money it needed to fund whatever programs be they social, environmental, educational, homelessness, poverty and any challenges that may appear as we enter into an age where all things are possible.

It would pave the way to repeal the 16th Amendment. The 18th amendment was repealed by the 21st Amendment when it became obvious that the evils it intended to eliminate were out weighed by the evils it created. Surely the evils created by the 16th Amendment outweigh those of the 18th amendment by leaps and bounds. The greatest of these is that it put the middle class workers into involuntary servitude, in effect nullifying the provision of the 13th Amendment it will eliminate the dichotomy between them. It will put the country back on a fast track to justice and equality for all.


Adam Smith

When examining the different forms of taxation, Smith adheres to four maxims which a good tax should conform to:

"The subject of every State ought to contribute towards the support of the government, as nearly as possible, in proportion to their respective abilities; that is, in proportion to the revenue which they respectively enjoy under the protection of the State."

"The tax each individual is bound to pay ought to be certain, and not arbitrary. The time of payment, the manner of payment, and the quantity to be paid, ought all to be clear and plain to the contributor, and to ever other person."

"Every tax ought to be levied at the time, or in the manner in which it is most likely to be convenient for the contributor to pay it."

"Every tax ought to be so contrived as both to take out and to keep out of the pockets of the people as little as possible, over and above what it brings into the public treasury of the State."

The transaction tax/user fee meets all four of the maxims of Adam Smith

Tax Foundation

Why is the Tax Foundation unique?

Numerous groups conduct research on tax and budget policy. But the tax Foundation is the only organization that: analyzes Data from all levels of government; explores the effect of tax Information to the general public. In this way, the Tax Policy on businesses and individuals alike; and channels this Information to the general public. In this way the Tax Foundation serves as a national clearing house, providing Americans with better understanding of their tax system and The effects of tax policy.

What does the Tax Foundation stand for?

As a nonpartisan educational organization, the Tax Foundation does not represent any particular economic sector's point of view. Through the years the organization has earned a reputation for independence, and credibility. Yet the Foundation is not void of perspective. From its founding day The organization has committed itself to principles which guide Its research and public information programs and which should be the touchstone for all tax policy. Well informed Citizenry. People must know who And what is being taxed and how tax legislation is enacted.

Simplicity. Complexity makes accurate tax Compliance needlessly expensive and punitive.

Stability. Frequent change lessens citizens Understanding of the tax code and complicates long Range financial planning.

No retroactivity. Taxpayers must have confidence in The law as it exists entering into a transaction.

Neutrality. The primary purpose of taxes is to raise Revenue, not to micromanage the economy with subsidies and penalties. The tax system should favor neither consumption nor saving and investment.

Promote economic growth. The U.S. tax system Should not impede the free flow of good, services, and Capital domestically or internationally.

The Transaction Tax/user fee stands alone in meeting all of the guiding principals of the Tax Foundation, the existing U.S. Tax Code (26 USC) does not nor does the two alternates that are espoused by the Heritage Foundation and the Cato Institute with much support from within and without the Congress.

Join the Artillery

As an Infantry Soldier in World War two I found it was necessary to precede an attack on enemy positions with a barrage of shells to destroy and weaken any enemy opposition and save casualties to us. I have been preparing since 1992, when I first saw the advantages of a transaction tax/user fee on the movement and creation of money, and rid us of the IRS, State, and Local tax collectors, who take more than one-third of a workers income. You can help me lay down the barrage by copying the following and send it to your Congressman and to as many others you feel might do the same. We can reclaim our government from the hands of the corporate raiders. Using the most powerful weapon of all the TRUTH.

Send to your Congressman and Senator copy and paste to e-mail

Dear Congressman_____________________:

There is a dire need to replace the IRS Tax Code with a fair and equitable tax that will be as simple and take as little out of the pockets of the taxpayers as is possible. I believe that the tax espoused on the URL is the only tax proposal that will do that. I therefore ask you to consider being sponsor or cosponsor of the proposed law it embodies.

Respectfully submitted your constituent,

Always include your name and address they only respond to their constituents. Since 1992 I have sent e-mail to every Senator and Congressman several times the only responses from other than my own, send automatic responses asking for your address in their district or state. If we bombard them with requests to sponsor they will react. It has been said "if the people will lead the leaders will follow". ---

All who wish to may use any or all of the text included, or link this site to theirs or use the information to disseminate it to others.

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