Should we do away with most cash?

I was listening to NPR last Friday and one of the guys being interviewed said that 85% of all the dollars in circulation are in the form of $100 bills. The numbers are the same for Euros and most other currencies. The idea is that the people who are using all of those large denomination bills are mostly tax cheats or criminal enterprises because they want to deal only in cash and not declare their profits to the tax man.

If we got rid of all bills larger than, say, $10 it would make it much more difficult for tax avoiders and criminals to effectively operate yet regular people would still have cash for their daily needs while the rest of transactions would take the form of electronic payme ts which are much more difficult not to declare. The net result if we just reduced the underground economy by just 10% would be an additional $500 billion or so of the economy moved on to the books or becoming transactions which have to be declared. This sounds like a win to me but what does wordforge say?

If we lowered the tax rates perhaps so many people wouldn't avoid the official economy.

I doubt your average pimp or drug dealer or owner of an unlicensed whole sale business are effected by tax rates. This would make it much harder for all of them to conduct their business and move money on a large scale.

Those would still be fine using $20's instead of $100's. They'd just use two suitcases.

Some companies also keep large amounts of cash. As I recall, Toyota keeps several billion on hand for factory expansions and such. Why? Because when you're dealing with really large amounts, banks just can't pay it out very quickly. Everything is tied up in stocks and bonds and other instruments that take time to convert.

Bingo!

Another reason people prefer cash is if they have court-ordered withholding for child support, alimony, fines, and such.

If we make a bet and I have to pay you $500, you get $500. If I paid you that as wages the government would take out a big hunk in taxes and Social Security, and then your ex-wife would take out a big hunk, and then the pedestrian you injured would take out a hunk, and on and on.

You mean people would actually have to start obeying the law? Tragic.

The day that legislation is proposed is the day I dump my life savings into Bitcoin before it skyrockets.

I had a guy come in once and paid cash for a $24000 car. We were there after we closed because the finance and sales manager had to count it twice when it came up $1000 short.

This gentleman was interesting, to say the least. The other sales person there thought he wasn't even serious, which is why I got the guy. When filling out the credit app, he says he doesn't even have an permanent address, and I'm like

But hey, he bought

At least he didn't pay with coins.

His next purchase was probably an airstream trailer.
And then to Wal-Mart for zombie killing equipment.
And that man was Ash Williams.

Perhaps going straight to a cashless society would work if things like bluetooth funds swap became more accessable.

The day it happens Bitcoin would have skyrocketed days before.

I rarely carry cash but the only time I really wish I had some is when charity and fund raiser people are in front of stores collecting. If they don't have debit I just can't buy what they are selling - sorry!

I have read this argument before. It's an interesting idea. Traditionally, the reason for large denomination bills was to facilitate inter-bank transactions. That has not been the case for a few decades, however, which is why the highest denominations today are much lower than once was the case. But I agree that few legitimate transactions involving actual cash rise to the Ben Franklin threshold. For myself, I very rarely pay cash for something over $20. And generally, unless I know I am going somewhere that does not accept electronic payment, I'm unlikely to carry more than $50 at any given moment.

Hey, good to see you! Just the other day, Ramen was complaining about all the pinkos around here, and I said that most of them were long gone. And yet here you are! Give 'em hell!

I rarely, if ever use debit, and Visa is only for online purchases.

We get screwed at both ends, and sometimes a third, for debit up here. Between the $1.50 (avg) to the bank and interac itself, plus whatever terminal fees (to cover their cost for using it) the business charges, and then the second transaction fee from the bank, it can cost several dollars.

Then there's the anonymity factor. I don't like the idea of my spending habits being tracked unless it's to my benefit. (i.e.: I pay my rent via an e-transfer because it's convenient AND provides a legitimate proof of payment.) Same thing with Air Miles and other "shopping points"... I don't want someone figuring out how much I spend at the liquor store each week.

I don't think so, in fact, I'd like to see the return of large denomination bills. I typically buy myself a new rifle at the end of the year and it's a pain in the ass to carry around ~$2,000 in $100 bills

What's wrong with tax avoiders? And, why are you lumping them in with criminals?

They still charge by the transaction in Canada?

That was a thing here in 'Murica in the 90s, and it had pretty much gone away by the time I was 18 and got my first debit/credit card 12 years ago. I don't encounter fees for the most part unless I swipe for gas at Arco.

Yeah, you do, you just don't notice it because most places build it into the price. Visa/MC take something like 2% of the total cost of the items purchased. Amex takes 3%, I think. Walmart's presently suing Visa over the fees they charge.

In the world of leftists doing what you can legally to lessen your taxes is theft and makes you no different then your common criminal.

But he was talking about illegal avoidance. Transactions under the table aren't taxed, and there's nothing legal about that.

Yeah on a second reading it's possible he meant that. However I'm still right. People who legally avoid taxes are looked at as the same as criminals by leftists.

Not by me. I would say they are a demonstration of why we need better laws with fewer loopholes, but if the person is following the law, that's fine. We all do that. I am, for example, very much opposed to the mortgage tax deduction. But it's in the code, and I will certainly use it.

Zombie we are talking about people who are running cash businesses to avoid paying the legal taxes they owe so, yes, they are breaking the law by not reporting their true income.

That's not "tax avoidance". That's tax fraud. "Tax avoidance" means using the laws on the books to your advantage to minimize your tax liability to the minimum allowed by law. That's a very specific and accurate term.

https://en.wikipedia.org/wiki/Tax_avoidance

What tax rate does a dependent on a conservatorship order have to pay? Or are you asking for your mom?

"Sometimes rich people dodge taxes, so we should just stop taxing them." That's a new idea, albeit a somewhat unsurprising one.