Long before the advent of paper currency in England, commerce was conducted using gold and silver coins minted to equal their actual value in those precious metals. By the 1600s, the merchants and the Crown had established a broadly accepted monetary system.1
Shaving around the Edges: Coin Clipping
Silver and gold coins nonetheless presented seemingly irresistible temptations to “shave” or “clip” their edges to recoup the metals as bullion, which also fueled organised crime with systematic debasement. As coins wore down in normal use, imperceptible clipping could go undetected. In fact, “some clippers managed to earn tantalising fortunes from the illegal practice.”1
Over time, the currency was generally so compromised that international traders would only accept “heavy” coins that ensured their full value. Merchants began hoarding intact coins, which further eroded trust and the value of the remaining domestic circulation. Soon after ascending to the throne, King William III envisioned a plan that became the Great Recoinage of 1696. The government then established the Bank of England and, ultimately, fully reformed the currency and monetary system.1
… and “Sweating” of Gold and Silver Coins
As some coins eventually wore down to a fraction of their original size, another form of coin debasement placed newly minted coins into a bag and shook them against one another. This practice of “sweating” resulted in gold or silver dust in the bottom of the bag before returning them to circulation, as if they had been in normal use – presumably less noticeably debased than when clipped, as above.2
From Coins to Clicks: Billions from Ad Buttons
Ever wonder how anyone makes money from those distracting ads we see when searching for shopping, events, or any other information online? Google AdSense ads reportedly generate from $0.04 for a Sports ad to $0.14 for every 10 page views in a Travel category, paying about 68% to the ad publisher from Google.3
And, those ads add up! “In 2021, Google’s ad revenue amounted to 209.49 billion U.S. dollars. [generated] through its Google Ads platform, which enables advertisers to display ads, product listings and service offerings across Google’s extensive ad network…”4 Every little bit counts. And Google made all that from the fraction they didn’t pay to publishers! Wow.
Mysterious Bank Deposit Taxes: A Million Dollars More than 2021!
Although it’s a fiscal mystery here in Anguilla, the government has been collecting millions of dollars every year for years from the Bank Deposit Levy. And they took more than another million dollars more last year. That is, the Bank Deposit Levy paid the government $5.3 Million in 2022 – up from $4.2 Million in 2021!5 Here’s another small fortune from fractions taken by taxing deposits we expected to be safe.
The 2% Take on Takeaway Transfers
Many people with some of the hardest jobs in Anguilla have not only been severely affected by losing 13% of their purchasing power when GST went into full effect last July 1st, but they actually lost 15% when helping their families offshore! That fractional “shaving” of the People’s coins is now collected as a 2% tax on all those MoneyGrams and Western Union transfers. Ironically, it was budgeted to give the government $800,000 in 2022; however, after imposing GST, the take for this tax fell short, ending up at $616,414. As an economic indicator nearly 25% below budget, we must ask: How many of our most vulnerable households lost up to a quarter of all they had as a result of GST? Or, were many forced to leave the island, hoping to survive in more favorable economies, free of GST? 5
And Not Getting Credit for GST on Credit Cards!
By year end, the government collected a reported $124 Million from “general taxes” on Goods and Services transactions throughout the economy. This exceeded a budgeted amount of $64 Million for the year – by tens of millions! 5 Ostensibly, businesses forced to collect GST were nonetheless “entitled” to deduct GST paid in the course of earning the revenues on which they were forced to take it from their customers.
If say, 80% of those general taxes were collected on credit card purchases with an average business cost of 3% per transaction, then 13% of those 3% fees was “over collected”: That would conservatively amount to some $400,000 across all businesses in 2022. It may not sound like a fantastic “fractional fortune” but that excess was about twice the fees paid for all post office box rentals. It would also equal about 2/3rds of that 2% paid by too many who worked so hard to send money home while working in the businesses that overpaid GST on credit card fees!
Taking a Fortune from Fractions and Fracturing Our Future
Given the size of that fortune the government took in “general taxes” on Goods and Services, were the People taken yet again?
All were told GST was desperately needed to yield another $22 Million per year – or $11 Million in 6 months. But, that $11 Million more we expected was only a fraction of the $60 Million more that they took! And remember, the government forced IGT on the People after Irma, and GST was imposed – and our civil rights taken – during a pandemic, no less.
Notably, about $23 Million of that extra take was collected from Accommodations before GST began last July. That alone exceeded $22 Million right there. All we ever needed was to open our borders!
And countless other taxes, from the Bank Deposit Levy, to workforce, property, and international trade added yet more – without GST, and far exceeded the sum on which GST was forced on the People of Anguilla.5 Looks like they never needed GST! Not a fraction of it.
In fact, repealing GST and resuming unrestricted commerce would replenish 13% of purchasing power to the People – and ultimately benefit those who imposed it. How? Generating 13% more trade would contribute to dozens of other previously established taxes, levies, and fees – while restoring $100EC to those left with just $87 – or $85 with families offshore – while the government amassed that fortune from fractions!
It’s time to make us all whole: Reasoned leaders must repeal GST – and while they’re at it, have the decency to respect our history by taking off that 2% take on those taken from their families trying to make ends meet from afar.
Repeal GST. Now.
This article reflects cultural and economic issues raised on July 5, 2021, at the House Select Committee on GST Public Hearing. 1https://britanniacoincompany.com/blog/coin-clipping-the-great-recoinage-of-1696/; 2https://en.wikipedia.org/wiki/Methods_of_coin_debasement; 3https://www.statista.com/statistics/266249/advertising-revenue-of-google/; 4https://seochatter.com/how-much-does-adsense-pay-per-1000-views-click/; 5Government of Anguilla 2023 Budget.
