ABC Taxation

Readers are recommended to read ABC Bank, ABC Financial Reports and ABC Legislature first.

1. Summary

ABC Tax is the simplest module in ABC ecosystem.

Each country has its own tax policy, so the ABC tax module is like a versatile socket. ABC cities in various countries can adjust the taxation module according to their taxation goals. However, the ABC tax module is based on the principle of "where gain is, also is tax".

ABC Financial Reports gives you all the information about the market, including who invested how much, when and how much money they made. The ABC tax uses such information to determine who should pay how much tax when and how. Also, no payment can be made without the approval of ABC Tax.

• No one pays more or less than the tax law specifies.

• There can be no tax evasion or expedient behavior.

• Everything is transparent.

• Taxation and collection are done in real time.

2. The Authorization of Transactions

In the ABC ecosystem, all transactions are confirmed and settled down by ABC Tax, both to prevent illegal or expedient trades and to collect tax in real time.

• All transactions should submit transaction details to the related tax authorities. For example, Alice in USA buys some product from Wang in China, the transaction details such as the quantity and price of the product, delivery method etc. are reported to the tax authorities of USA and China respectively.

• ABC Bank transfers the payment from Alice's account to Wang's account after getting approval from both tax authorities.

• ABC Bank also transfers the related taxes to those tax authorities from the accounts of both buyer and seller.

In other words, the tax authority of a country automatically participates in any transaction in which a citizen of that country is either a buyer or a seller.

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3. Where gain is, also is tax

Since ABC generates and updates the financial reports of every market participants, normally from birth to death of individuals and corporations, ABC knows everything about the economic status and activities of all citizens and corporations in the city.

When a transaction arises, ABC calculates the taxation based on the legal status of the traded product, and its seller and buyer. The legal status is designated by ABC Legislature.

For example, when Alice bought a digital book at ABC 10T from Bob's company, the related consumer tax if any and the income tax of Bob's company are calculated and collected from their ABC bank accounts respectively in real time.

• The price of the digital book is 10T.

• The cost of the book is 7T.

• The net income before tax is 3T.

• The income tax ratio of Bob's company is 30%.

• The consumer tax for digital books is 10% of the price.

When authorizing the transaction, ABC Tax collects 1T in consumer tax from Alice's bank account and 0.9T in income tax from Bob's company.

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