Model Economy

The Model Economy is a proposed economic model in Urcea which intends to transition the country's economy from an investor-based capitalist system into something more closely resembling a market distributist economy. The Model Economy, named for the 2023 "Model Economy Act", is the primary economic platform of the Solidarity Party. The Model Economy has been referred to as the "summation and perfect expression" of Wittonian Socialism.

The Model Economy Act, and proponents of it referred to as Model Economists, envision a general repurposing of the structures of a market capitalist economy to come more in line with the moral and social vision of Organicism and Wittonian Socialism by proposing various kinds of ownership in common. Specifically, the Model Economy Act created a general economic structure in which employee ownership of firms, either substantially in part or in full, becomes the norm of firms within the economy. With respect to both housing and agricultural undertakings, efforts would be taken to convert much of the country into proprietor communes. The Model Economy Act intended to bring about these outcomes by incentives or by erection of new properties and firms with these characteristics rather than by coercion or penalties. The overall goal of the Model Economy is to bring about a "preponderance of widely held economic institutions" such that these models are used by a majority of those within the economy rather than establishing it as a coerced, uniform economic policy.

In conjunction with the fundamental conceptual changes in the economy, taxation under the Model Economy would be revised. The original Model Economy Act called for the total repeal of the Royal and Provincial Tax Act of 2020 and other national taxes and replacing it with a simplified tax structure with a land value tax and national value added tax while replacing a number of fees and dues from government licenses and other activities with a single "public activity fee" of ₮220. The two taxes and single fee, along with various import dues and customs, are thought by Model Economists to provide sufficient revenue for the functioning of the state, a claim which has proven extremely controversial. The Act did not contemplate the types of taxes that the government subdivisions would levy, as the legislation's authors argued it was an issue of home rule, although in the intervening years Model Economists have been significantly divided on whether or not tax simplification should apply to lower governments as well or if lower governments should be able to tax at all.

In 2029, the Conshilía Purpháidhe passed and the Procurator signed the "Pilot Economy Act", legislation which implemented the incentives envisioned by the Model Economy Act without changes to the tax law. It represents the first enactment of the Model Economy system within Urcea. Unlike the original Act, the Pilot Economy Act is designed to repeal itself in 2033, though with existing firms unchanged by the repeal of the law. Following the repeal of the law, a full study on economic impacts is to be conducted and a report returned to the Conshilía Purpháidhe by no later than 2035.