Cyprus Is Just Proposing a More Efficient Way to Steal Taxpayer Money

As part of its European Union bailout agreement, the small Mediterranean country of Cyprus is proposing to take money directly from people’s bank accounts—a kind of reverse direct deposit. The plan seems to have rattled financial markets and raised protests from around the world.
 
But why? The Cyprian government is simply proposing a more efficient way of robbing its citizens. The real wonder is that cash-starved, big-spending, debt-ridden welfare states haven’t already implemented just such an approach.
 
President Obama must be asking his advisors, Why didn’t we think of that?
 
The initial proposal was to take a 9.9 percent “stability levy”—note the nomenclature, like “shared responsibility,” is part of the marketing campaign—on deposits over €100,000, and 6.75 percent on deposits below that amount.
 
However, under withering criticism, the government seems to be recalculating, and may propose a three tiered approach, which would exempt the smallest depositors.
 
Obama has already gotten his tax on savings. His fiscal cliff agreement pushed through a tax increase on passive income, such as capital gains and dividends. Had the president gotten his way, capital gains would have risen from 15 percent to 20 percent and dividends would have jumped from 15 percent to 39.6 percent on incomes above $250,000 for a family.  As it stands, both will be taxed at 20 percent on incomes above $450,000 for a family.
 
Oh, and he already raised taxes on passive income with one of his many new ObamaCare taxes, which added a 3.8 percent tax on passive income on families with incomes above $250,000.
 
But the Obama tax collection scheme is much less efficient. Taxpayers still have to calculate what they owe and pay it. From the government’s standpoint, that leaves a lot of room for—What shall we call it?—leakage.
 
The Cyprus model is even more efficient than the IRS’s proposed Real Time Tax System, which would allow IRS agents to have access to all your data and to come up with their own estimate of your taxes.
 
So, yes, the Cyprus money grab is unsettling, but only because it is so blatant. Obama’s money grab may have been more subtle, but the results are the same.