New Tax - If you plan on selling your home then Gov't wants a little now too!

Re: Robber Barons...

Yes, there are (were) robber barons who stole money. There are also frauds who take the welfare intended for the truly needy. I don't have the numbers in front of me, but I'd be willing to bet good northern money that the latter far out number the former.

 

But I'd bet the few robber barons stole more money than the many welfare frauds. Adjusted for inflation, of course!

 

I doubt it. Besides, there are now laws that prevent robber barons from functioning. Too bad the same can't be said for the welfare frauds.

 

Maybe you should check the legal code as there are laws against welfare fraud ...

 

Increased costs will affect the ultimate price, but not as directly as some people assume. To say taxes will be "passed on" to the consumer is an over-simplification.

It is true that the price will always be the highest the market will bear regardless of the cost of production. But as the cost of production rises, some producers will drop out of the market, reducing the supply. Price is a function of supply and demand. So if the supply is decreased, the price is increased.


A tax on profits is not a cost of production, so should make very little difference in the supply of a product. A VAT, or Value Added Tax, which has been proposed in the past, would be a cost of production and would affect the supply and therefore the price of goods and services. (That is not the "Fair Tax" that has been discussed recently, that's a different animal.)

 

KDsGrandma got it right about the fall in supply and the rise in price. The amount of the price increase depends on the elasticity of supply and demand, but taxes are almost always passed on to the consumer.

I disagree. In the long run, investors will not just let their profit margins fall ...they will move on to other things and it will have the same effect as an increase in the cost of production. Ultimately the consumer pays the tax.

http://www.heritage.org/Research/Taxes/cda04-12.cfm

Go tell starving people in Africa that Americans are struggling for "survival" and see how much sympathy you get.

 

Increased costs may affect the ultimate price if the profit margin is insufficient to accomodate it.

True, for those items that affect the production cost.

True. The Fair Tax would even remove any taxes on supplies used by the business in addition to the removel of the tax on profits.

 

Now, it is "almost always" so it it getting more realistic in presentation.

Since under the current system they still pay the taxes on profits regardless of where the profits originate the profit comparison is tax neutral and as such does not come into play as you claim.

Sorry, you were trying to make a point? Go tell the starving people in Africa about your problems with taxes on profits and compare the sympathy levels.

 

There are also laws against illegal immigration. So what's your point?

 

You stated there are not such laws and I just corrected you ....

 

But when you look at the mire of subsidies and mountain of regulations, its anything but neutral and people will move to other sectors looking for loopholes and higher net profits. Let me clarify my "almost always" remark: In the short run producers might shoulder the tax burden, but in the long run it will always be passed down to the end of the line ...the consumer of the good or service. "Who pays what" is just a shell game. What we should be asking ourselves is not "who pays what", but does our government really need all this money.

 

It is only "passed on" if you wish to believe it. The tax on profit cannot impact the cost of goods in any meaningful way. The "passed on" accounting can also be tracked back to companies paying wages if one wishes to take that route. It is all smoke and mirrors to try to support a preconceived notion. Those who claim the government does not need the money usually seem to never know the impacts on the society of what is spent, but just as the "who pays what" try to juggle the accounting in some fashion.