TCS phase 2

TCS phase 2 is a consumer tax system in which tax rates are based exclusively on the carbon footprint of every single ingredients and components of consumer goods

The main proposal of TCS phase 2 is to use government digital currencies and registers to apply a custom VAT per ingredient or component of a product based on their carbon footprint, in order to increase the price of products that are harmful to the environment and therefore make them less attractive. TCS ambition is to replace the VAT we know today by a transparent and ecological system to improve our consumption model and to foster the use of governmental digital currencies and ledgers.

In TCS phase 2, the information on carbon footprint used in TCS phase 1 is used to determine a tax rate per ingredient or component of a product. These tax rates are then added up to calculate the product consumer tax rate, as shown in the graph below:

Ingredient lists and associated TCS have to be registered on a public permissioned blockchain managed by a public administration before a product is launched. The public administration then grants (or not) access to the market and matches each ingredient with a tax rate calculated according to the four criteria. Revenue allocative keys are determined through a process involving producer, PSP, POS and administration.

TCS pluses

  • Tailor-made and ecological: tax is calculated per product according to its ingredients, which creates an incentive for consumers to purchase and manufacturers to produce environment friendly products
  • Systematic and large-scale: TCS replaces VAT and therefore applies to any consumer good
  • Transparent: everyone can consult the TCS blockchain and see TCS amounts generated by point of sale without knowing who end consumers are
  • Instantaneous: amounts spent by consumers are instantaneously transferred to the relevant stakeholders by the distributor payment service provider, including the consumption tax, which makes accounting and payment deadlines useless.

Technical aspects

  • TCS is based on a public permissioned blockchain as well as a masternode structure managed by a public administration
  • The technology behind TCS payments is called IDCS (instantaneous digital converting and settlement) and is under development
  • TCS and its sub tokens are stable governmental digital currencies managed by the public administration and pegged 1:1 to the national currency
  • The formula on which TCS is based is not disclosed here and is based on scientific environmental data related to each ingredient and component.

TCS is based on government digital currencies and ledgers. All currencies used in TCS are pegged to the national currency to provide the necessary stability to the system. Discover the underlying technologies of TCS by clicking on the links below:

Public permissioned government blockchain

A shared digital ledger, commonly known as a blockchain, makes it possible to record, trace, process and publish transactions in a very systematic and efficient manner. The use of a public permissioned blockchain makes it possible to ensure the transparency but also the reliability of the system, because only the relevant stakeholders (manufacturers and public administration) will be able to enter data on the ingredients of the products and their properties, which will be used to determine the associated consumption tax TCS:

Digital currencies enable micropayments

Digital currencies make micropayments extremely fast and inexpensive, which will make our payment systems much more accurate and amounts vary in real time according to relevant variables, as airlines already have been doing for decades with ticket prices. Models using real-time data like the one provided by oracles in blockchain-based models will enable dynamic price forming. The underlying technology of TCS is IDCS, instantaneous digital converting and settlement:

Digital currencies = vectors of information

Digital currencies can be created and dedicated to a very specific use, which gives money a fourth function, in addition to being a store of value, an intermediary of exchanges and a unit of account: it becomes a vector of information. The simple use of a currency is sufficient to convey relevant information on what has been accomplished or should be accomplished. For example, the simple fact of using or holding “Hilton Coin” means that a person pays or intends to pay for one or more nights in the Hilton hotel network. Currency thus becomes the new “data”.

TCS phase 2 introduces the ecological basic income

RTP is an ecological basic income in the form of a stable governmental digital currency made to “give citizens the right to pollute” up to a certain extent.

Conceptual aspectsTechnical aspectsPrerequisites
  • RTP is also a stable government digital currency pegged to the national currency
  • RTP is issued once a month and distributed to citizens at an amount per person decided by the public administration, for example 10 RTP/month/citizen
  • RTPs intended for children under the age of ten are sent to their parents or legal guardians
  • RTPs can only be converted to 1:1 into TCS or Ignite or 0.9:1 into the national currency
  • Citizens can redeem any amount of RTP tokens at fiscal authorities at 1:0.9 rate against national currency
  • Visitors to a country will be able to apply for RTP on request during their stay in that country depending on the duration of their visa.
  • RTPs are managed on a public permissioned governmental blockchain under the PoS (proof of stake) consensus algorithm
  • One transaction block is created per second by one of the network participants
  • An RTP is automatically rewarded by the system to the creator of each block, who is chosen randomly among RTP holders according to their weight in the system.
  • The digital euro as well as the legal possibility for States to create digital currencies and blockchains
  • The implementation of IDCS technology
  • The modification of the VAT calculation principles to make it transparent and ecological.