HUB.MN — The implementation this month of the Trade Equality Act by SCUE has divided members of the Micras community, with many expressing that the intermicronational organization has no role in taxation.
The Act was introduced as the first measure of newly-appointment SCUE Administrator Pallisico Sinclair as a means of promoting trade and trade equality amongst the organization’s member micronations. To accomplish this goal, a 5% tax is imposed on the total currency reserves of each member that has a bi-monthly Gross Domestic Product (GDP) equal to zero. If the member has a GDP greater than zero, it will be rewarded by being granted a sum from SCUE equivalent to 5% of the value of its total transactions during the bi-monthly period. The first taxes are scheduled for debiting on April 1.
It is the expectation of Sinclair that the tax will spur members that have dormant economies to begin making transactions and increasing economic output to qualify for the reimbursement incentive. “All that is requested in order to avoid a tax is at least one transaction,” said Sinclair in attempting to minimize any opposition to the tax, as one transaction would result in a non-zero GDP.
Despite his attempt to minimize the negative connotations associated with the implementation of a tax, the SCUE Administrator quickly experienced a backlash from several micronationalists who hold accounts with the organization’s bank.
“Are you kidding me? You cannot just steal half of my personal money,” exclaimed Jack de Montfort at the prospect that his holdings in Coria would be taxed due to the micronation’s lack of trade activity. Sinclair rebuked Montfort harshly in the exchange, replying that “Clearly, doing nothing has not encouraged you to participate in any meaningful way.”
Malliki Tosha, the Arbiter of Shireroth’s Imperial Judex, questioned the legality of the measure, noting that the organization was in his reading of its charter treaty only permitted to enforce, not introduce, taxation. “Even if you can interpret it as meaning that [SCUE] can impose taxes, I would still consider the language ambiguous,” he said.
That opinion was echoed by Iain de Vembria and Vilhelm Benkern, the latter of whom angrily pronounced that “SCUE shouldn’t be led by a despot but someone who takes in the views of many members.” Benkern called on SCUE to re-think the implementation of the taxation, calling it counterproductive to economic development. “[The organization] should surely be providing a platform for co-operation between member states and allowing them to flourish themselves, without having to actively ‘encourage’ or penalise certain nations in the way proposed.”
Yet the pronouncements of those in opposition to the tax have failed to sway the opinions of several micronationalists who voiced support for the measure. “… Penalising members for just sitting on piles of money and never spending it seems fair,” Joe Foxon opined with the support of Giles Melang and James-Robert Knight.
Former SCUE Administrator Andreas the Wise, while agreeing with Tosha’s legal interpretation of the treaty, nonetheless expressed his support for the tax and encouraged further discussion on its merits and implementation. “This actually sounds like quite a reasonable plan to me – taxing [inactivity] and rewarding economic activity,” he said.
Despite the ongoing opposition from his detractors, Sinclair appears to remain intent on implementing the tax. “If most aren’t using the currency, then the currency is essentially worthless,” he proclaimed, “It is not in the interest of the bank, or of the members …, for the currency to be essentially worthless. Therefore, it is incumbent on the bank [to] adopt fair measures to promote the usage of the currency, even if it means taxes.”