De-Taxation

Economic wealth creators and de-taxation: real economy vs service industry


When I started analysing the economic KPIs of my economic theory, the Sovereign Economic Model, I had a look at which industries create the wealth of a country.
I went back in history, and noticed that ALL countries became prosperous when the manufacturing industry was as its peak:
USA in post WWII as Europe, Japan, China, and Korea were ravaged
Europe: post WWII recovery in 60-80ies
Japan:  post WWII recovery in 70-90ies
Korea:  post Korean War recovery in 80-00ies
China:  post revolution in 1980-ongoing
India:  Upcoming

Feedback is often that US, Europe, Japan are rich countries, buy in fact their raw value creation has decreased, and are using the amassed wealth created during manufacturing peak to create little marginal value, the service industry pushing around money from that old accumulated wealth. Profits produced are often just margins from outsourced manufacturing and related services.

The Sovereign Economic Model proposes to de-tax all wealth creators, i.e. manufacturing business and the IT industry(software). The reasoning is to encourage investment and creation of value through manufacturing of real products.
Real products require an immense level of knowledge, science, skills, tools and organization, therefore add much more value to it ingredients (natural resources) than any service. Real products generate much more employment, therefore distribution of wealth, than services. 

Russia already has de-taxed the IT industry, now they should move to similarly de-tax all the manufacturing businesses. https://news.bloombergtax.com/daily-tax-report-international/russia-radically-changes-tax-landscape-for-software-companies

I hope that many countries apply de-taxation to local manufacturing businesses, which can create and distribute wealth better than any other industry sector.

Export organization: special new legal (company) entity form is required


I touched on export organization on several blog posts
http://www.sovecomo.ru/category/Export

One can often see that many very export oriented companies like Nestle, LVMH and Kettering (French fashion conglomerates of many brands) condensate many brands below a single umbrella, even if single brands retain their identity. This facilitated the entry into new markets, because of their critical mass.

I was thinking why several independent companies could not do the same. While in a home market they fiercely compete, in international markets they struggle because they are just too small.

So, if they congregated into one organization solely for export? yes, surely it would lower costs of shared offices and sales reps in foreign countries.

Since export is very important to many countries, it would be useful to create a new type of company entity congregating many or most industry players into one organization, e.g. called EXP Ltd. This type of company entity should only be allowed to do foreign sales and should have a lower taxation.

This is also mirrored in the Sovereign Economic Model, which among other de-taxation policies, proposes to tax exports 50% less.

A more conveniently organized and less taxed export activity would benefit both the companies and the country itself.

Competitive Advantages of small medium businesses


In the Sovereign Economic Model emphasizes very strong support for Mittelstand - small and medium businesses. SME -SMB have a lot of potential competitive advantages for a sovereign economy:

Potential for large employment
Requirement of less capital
Contribution to industrial output
Contribution to exports
Earning foreign exchange
Equitable distribution
Decentralization - regional development
Use of domestic resources
Opportunities for entrepreneurship
Cost efficiency
Suitable for non-standardized products
Flexibility in operation
Quick decisions
Adaptability to change
Small market size
Customization
Low social costs
Opportunity for talent
Lesser industrial disputes/unions
Personal contact with employees
Personal contact with customers
Self interest
Market niche saturation
Quick Investment and Production
Preservation of Inherited Skill
Easy flat Management
Community Involvement
More risk taking
More innovation
More efficiency/teamwork


In order to support small and medium business the Sovereign Economic Model proposes a de-taxation policy with 0% tax range for all manufacturing businesses.

Суверенная Экономика и освобождение от налогообложения



В модели одной из фундаментальных частей является освобождение от налогообложения малого производственного бизнеса в зависимости от уровня сложности конечного продукта и других параметров.

Я уже отправил сообщение по адресу http://www.sovecomo.ru/post/2020/12/24/Освобождение-От-Налогообложения-Мелких-Производителей.aspx

После нескольких бесед с друзьями и контактами я приближаюсь к тому, чтобы определить матрицу, в которую включить параметры и как структурировать ее, чтобы рассчитать конечную сумму дохода, чтобы сделать ее свободной от налогов.

Он должен основываться на балльной системе расчета безналогового режима:

Сначала мы определяем 5 групп Майоров:
1) сельское хозяйство
2) Пищевая промышленность
3) FMCG
4) Промышленные (машины, инструменты) и химические
5) высокие технологии(программное обеспечение, космос, ядерная промышленность, фармацевтика, )

По умолчанию каждая группа будет иметь определенное количество очков.

Следующий параметр-это капитальные затраты, т. е. первоначальные инвестиции. За каждый вложенный миллион будет больше очков.

Также должен быть список других параметров, которые дают дополнительные бонусные баллы. Некоторые из них могут быть:
- Агропродовольственная самодостаточность: некоторые сельскохозяйственные товары, производство которых значительно ниже 90% потребления России, - это молоко, говядина, чеснок, яблоки, груши и ряд других.
- Сначала на пост: производство новых продуктов, никогда ранее не строившихся в России
- Стратегические приоритетные направления: дополнительные бонусы предоставляются, например, фармацевтическим компаниям, производящим базовые химические вещества для лекарств .
- Плотность рынка: если слишком мало компаний, не покрывающих внутренний спрос, дополнительные баллы могут быть даны компаниям, входящим в этот сегмент
- Региональное развитие: дополнительный бонус для компаний, работающих на Дальнем Востоке, Арктике или в регионах с безработицей выше среднего
- Передовые Исследования И Разработки
- Другие бонусы