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Dear ovrtaxt,

I think you may have missed my point.

I was pointing out that Little Miss Nanny is legally obligated to collect the 30% NRST, yet she will not.

She and the family are, under the NRST, evading taxation. Just as she and the family avoided taxation under the income tax.

The differences are 1) she must pay taxes on her purchases now; but 2) the couple previously paid taxes on the income used to pay her.

Thus, under the old law and the new, tax was to be paid twice.

Under the old law, tax should have been paid by the couple at the point of income, and the nanny should have paid tax, also at the point of income. But only one tax is paid.

Under the new law, tax, again, should be paid twice. The couple should pay tax in their transaction with the nanny, and the nanny should pay tax on her purchases. But, again, only one tax is paid.

Thus, the approximate level of tax evasion remains the same, the new NRST doesn't "capture" any part of the underground economy not captured by the previous income tax.

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