Economic Policy Manifest Of The Republic Of Kochatka

The following is the economic policy manifest of the president of the new 'Republic of Kochatka'. It is written for the benefit of all CEOs who currently operate corporations within the republic or who may operate corporations within the republic in the future, outlining the president's economic policy for the foreseeable future.

Immediately following the president's registration of the republic, the corporate profit tax was raised to the maximum permitted level as a temporary measure to help raise funds to rapidly develop the republic's education, transportation and health infrastructure. This phase of the republic's planned development is now nearly complete, with only the building of back-to-work schools and special clinics remaining.

The president currently intends to maintain transportation, health and social security indexes at or slightly above one-hundred in order to maintain a welfare index sufficient to k

Update: Targets for the transportation and health indexes have been increased to 120 as per the request of a CEO. Consequently as the beginner's income booster wears off, the corporate profit tax may need to be raised to a higher level than would otherwise be necessary, to compensate.

welcome to sim country, and thanks for the info, a bit much to read tho

Welcome indeed!

I apreciate your honesty but i would never invest in a country which doesn't garantee a 0% tax rate. But that's just me.

@ blah Blah:

The corporate profit tax rate isn't nearly as important as the country's education, transportation, health and social security indexes. With low indexes, workers are less motivated. Then it becomes harder for corporations to earn money and easier for them to lose money. A 0% corporate profit tax doesn't benefit you at all if your corporation is losing 100.00M SC$ monthly. In contrast, if your corporation is earning 400.00M SC$ monthly, then even if the corporate profit tax was 99%, you'd still be earning 4.00M in net income from that corporation. That isn't much, but it's still better than the corporation losing money. High taxes can certainly hurt CEOs, but low indexes can hurt them much more. Therefore sometimes its better to accept a high tax rate even though you don't like it, because without it a country might not be able to sustain the high indexes needed to keep your workers productive.

Something to think about.


At best you can generate 20% extra production with all those extra investments your goverment makes.

Do you think that compensate for: 47% tax rates?

Depends on the corporation, but the answer in some cases is yes. Especially at higher salaries. How many cases and what percentage? I'm not sure.

Pherhaps in some corner cases it will. But generally speaking for most corporations it won't.

@ blah Blah:

There's a law of diminishing returns involved. You have to keep your country's indexes at a certain minimum level or corporations in your country can't earn anything at all. At the same time, each successive point you raise your indexes by costs the same to maintain, but provides less of a return. At some point there has to be an ideal compromise between low taxes and high indexes. Originally my plan was to keep my education index at 200, and my transportation, health and social security indexes at around 100 so as not to require too high a tax rate, because in the past I have found that to be a good balance. However, I was requested by one of my CEOs to raise my transportation and health indexes to 120, which I am now working to do. However, if other CEOs complain about the higher tax rate which this will necessitate, I may lower those indexes back down to 100 in order to keep my tax rate down.

I understand how the game works. Feel free to look up my country ;)

I would have loved it if your policiy would work. But it seems that it's not working. Your economy is just to small to sustain your numbers. To bad, i would have loved a new strategy for my new countries.

With a 47%ish tax rate I would expect a lot better index numbers then 120 but I've seen enough. Good luck with your country and make sure to have fun! That's why we play this game!

@ blah Blah:

Lol. You realize I'm just getting started on this country right? It's far too early to see whether or not my policies will work. Right now my country has far too few corporations to employ all my workers. Consequently, there are fewer corporations contributing country resource payments to my country's treasury, reducing its income, and for the same reason there are also more unemployed workers receiving social security payments from my country's government. As more CEOs establish more corporations in my country, both of those problems should be alleviated. Also, some of the corporations in my country aren't being managed properly by their owners, and are consequently taking significant losses. Because of this, they also aren't contributing much to my country's treasury. As I gradually weed out such corporations and various CEOs build better corporations in their place, that problem should also be alleviated

Private corps are overrated.... Try 120 indexes with 85% social security

i agree with jackwagen, although i'd got 93ish for SS, take a look at how much a state corp makes, compair that to the country pay out of CEO corps... State corps make all their money for the country, private, don't make nearly so much, even tho they are more "profitable,"

@ Orbiter:

I already checked that. According to my recent observations, well run private corporations pay more on average in country resource payments than the average total profits of well-run state-run corporations. That doesn't include the corporate profit tax which can also be levied.

Just to add~ Private corps allows you to have clinics/back to work schools which increases your overall avail. workforce for more companies, in turn more income~ But since there is a cap, its best to have a mix of both state/private companies.

Well when i say state corps I mean public corps.... Public corps can upgrade higher then private corps and you can manipulate the values with the Tax rate to make money

You can also decide what exactly you want to build without relying on the whims of a CEO..... Sure there is a small small risk of hostile takeover that can be managed by working with others to buy your shares but it is no greater risk then the risk of a CEO going bonkers and setting production to zero

@ Jackwagen:

I know about the risk of CEOs going bonkers. That's why I have a policy of seizing and closing unprofitable CEO-run corporations if the CEO fails to remove them within a reasonable time after I request that they remove them.

Policy Update - Introduction of Air Transport Corporations:

In general, CEO-run corporations are more profitable then state-run corporations. However, air transport corporations can only be built by presidents and not by CEOs. However, many presidents prefer a fully CEO-run economy, and so are reluctant to build any state-run corporations, including air transport corporations. This often artificially bids up the price of air transport services, rendering such corporations unusually profitable. Consequently, The Republic of Kochatka is now introducing state-run air transport corporations, which will compete freely alongside CEO run corporations. These corporations will be subject to the same fundamental rule as CEO run corporations: Namely that whenever there is more demand, from corporations, for the republic's workers and resources than the republic can meet, those corporations, private or public, CEO-run or state-run, whose total contributio

I'm just planting a bunch of corn and hoping for the best.

@ Karrde:

Lol