The mini-government (migov) recognizes only its specified electronic currency. This currency shall allow real-time taxation as well as auditing of individuals and organizations. Each person is eligible to one account only. No interest shall be paid for funds in the account. Upon the death of the individual, the account shall be closed and the money transacted according to his or her shall subject to the transaction tax specified below.
Any transaction shall be subjected to a 1% tax (which is cheaper than most credit card fees). This tax shall be accumulated until the end of the day, whereby transactions shall freeze for a short time for a readjustment. Half of the taxes shall be redistributed equally to all valid citizen accounts, regardless of their wealth level. The other half shall go to the custodian bank account managed by the Political Party In Power (PPIP).
There shall be no other taxes.
All the bank accounts and transactions shall be fully open and viewable by all other citizens. No exceptions shall be made for civil servants or political leaders.
Individuals are free to possess or use currencies (including physical gold) to conduct their personal anonymous transactions. However, the government shall not provide any legal protection for any business deals or transactions conducted in full or in part using such other units of exchanges.
To prevent excessive dependence on one entity (i.e. “too big to fail”) or excessive risk-taking, financial companies can choose to specialize in only one of the following:
- Savings and loans
- Domestic Investments
- Foreign Investments
- Exotic Investments
- Insurance for financial companies
Fractional reserve banking shall be banned. Any bank found guilty of this practice shall be shut down and its owners charged with currency counterfeiting. Full-reserve banking shall be the only acceptable standard.
Just as with Islamic financing, financial institutions shall neither charge nor accept interest. Instead of interest bearing loans, people can opt to provide an interest free loan for charity or purchase shares in a company, project or venture for investment purposes.
The mini-government shall take the lead by issuing shares to raise capital for its own spending and projects. A fixed amount of its operating surplus must be paid out as dividends to shareholders.