Interesting to note that paper money was introduced because of emergency shortages in coins and metal money.
When Marco Polo came back from his travels in China (1275-1292), people in Europe didn't believe that the Chinese used paper for money. Paper money in Europe came 300 years later. The use of paper money in China stopped in 1455.
The history of paper money in Europe is interesting. It started as emergency money sustituting for regular money. The first emergency paper bills are from 1483. The first bank notes were printed in the 17th century.
Source: Banknotes.com - Introduction to Collecting of World Banknotes - Currencies of the World
Similar to Income Tax, which was collected as a "temporary" wartime measure, and now dominates most fundraising activities by governments.
Of course, there are glitches in the automated tax collection systems from time to time.
The Canada Revenue Agency (CRA) system went down sometime Sunday night or Monday morning and, "We have now traced the source of the problem to software maintenance conducted on March 4, 2007," says a CRA statement. "We are currently working to bring all systems back online gradually."
Source: P2P.NET
This could potentially cost the government, it's employees, and the Canadian economy millions. The government will lose interest on unpaid taxes. If nobody gets their refund on time, consumers will be less inclined to purchase items that are non-essential, like plasma TVs or iPods. RRSP loan borrowers will have to float their loans longer, which may cause some borrowers to default on payments.
Last year the government processed almost 25 million individual and 1.7 million corporate returns, returning $18 billion dollars. That's over 49 million dollars a day. Not to mention the cost to H&R Block and other tax professionals who no longer have a way to quickly skim a percent or more off your instant return. Moneymart & RentCash should be doing well right now...
Whatever happened to backups & mirrored systems? If this were a bank machine being down for more than 5 days, how many CIOs would last through that one?
On another note, mortgage rates appear to be on the rise. Here's one way to make your house tax-deductible to offset the pain a bit.
