I'm tired of the "Corporations need to pay their fair share" BS mantra

I suppose that's true, to a degree, but it also provides more transparency to taxpayers as to just how much it is they're REALLY paying. But the sad reality is that most people are so stupid about such things that they truly believe that a tax refund at the end of the year is government sending them free money. They don't realize it's just a refund of an interest-free overcharge that they originally paid for in the first place.

You are correct insofar that citizens (or more accurately, end-user consumers) are the ones who are paying either way. But it's more intellectually honest and transparent for them to know what the actual amount they're paying is to begin with actually is. But it's certainly in a politician's best interest to create and maintain the lie that "someone else" is paying for those taxes in the first place, regardless of party. In this case both parties are equally guilty.

And it SHOULD result in taxpayers hissing. At least hissing, pissed off taxpayers have the option to fire politicians at the ballot box, which is an option unavailable to geese.

So, yeah, I capiche, and it seems like you do, too, but you're okay with it because of your perception that the evil rich are the ones bearing that additional tax burden. That's a lie, too, but one you've told yourself so many times that you now believe it. But it's not rich people who pay the price for it when a yacht-maker goes out of business, there's always another yacht-maker to choose from, after all. It's the poor and middle class workers that you pretend to care about so much who are losing their jobs, and paying a much larger price as a result. But I suppose if that also means a few "overpaid CEOs" and other executives lose their jobs, too, that makes it alright. And those execs usually find a new job very quickly, even if it means picking up their roots and moving down a notch or two in their "rank". After all, they deserve it for driving the company out of business in the first place! (Even though it was really the government who did that!!)

But for the schlubs who swing the hammers and insert the rivets who are not quite as able to just up and move, too bad, so sad. That's just an unintended side effect. But unfortunately, unintended side effects are what make bad laws into bad laws in the first place.

Politicians who pass those laws: "Really??? We had no idea it would do that!!!" When the truth is most of 'em did, they just didn't care if it made them look good to their own potential voters. Of course, that's followed up by promises to revisit it during their "next session", promises which of course never come to pass.

 

Yeah worked great when we were the only game in town by the fifties even JFK understood it wasn't working any more. And by the way, in the fifties spending priorities in the fifties 65% military 20% infrastructure and 5% social, and there were no unfunded federal mandates and revenue generated as a percent of GDP wasn't significantly more than it is now. Oh and state and local taxes were miniscule.

 

Transparency is nice, but it's an ideal no politician will go a long with due to the reason mentioned previously.

you meant 'should' ....eh? I believe they should, but they don't. Because they can hedge while the lower class cannot. And, their hedging outpaces incomes and inflation, for the superrich.
I used to be a republican, In 1980, I was going to vote for Reagan, but I voted for Ed Clark, instead, who was the libertarian nominee back then. I got tired of arguing with democrats, I believed every sound bite republicans were spewing. So, one day, I decided to go down to the library, look up performance stats, comparing republican administrations to democratic administrations. Obviously, given that most businessmen were republicans, republicans policies would be the better performers on jobs, GDP, inflation, deficits, budgets, and so forth. BUt, I wanted the stats in front of me to present to democrats whenever I got into an argument at thanksgiving, in bars, et.c, so I could just pull out the hard stats, and that would end the argument, once and for all.

But a funnying happened, to my utter amazement and confusion, as it turned out, almost all of the stats favored democrats, particularly stock gains, and I couldn't wrap my ahead around it, but there they were, the data was concrete. I slowly became a democrat by the time Clinton came. Now, I realize that no president often has both houses,or both houses and a filibuster proof senate, so there is some 'two to tango' going on. That being said, the president can drive the agenda, and strongly influence what goes to the floor, debated, and he is the one that signs it. I say this because when clinton ended his term, he had a multibillion dollar surplus. Repubs like to take credit, but if repubs are going to fault dems for when **** goes wrong, they have to give praise to the man at the top when things go right. The prez signs the bills, so, he owns them, no matter who wrote the bill. The buck stops with the prez. The two big crashes, 1929 and 2008 repubs were in the WH, and repubs presided over most of the recessions., if repubs are so much better for business, you'd think their stats would be better, and they just are not.

Also, people often view GDP stats wrong, the correct way to do it is in fiscal years, because no policy a president enacts can have any effect on the economy until his fiscal year begins, on Sept 1 after he takes office. So, I hear repubs say Trump's GDP was way better than Obamas. No, when view in fiscal years, the difference is marginal. But, viewing GDP going back decades, dems win hands down. Now, noting that clinton has one of the better stats when it comes to economic growth, and so forth, but towards the end of his term, he signed two bills, Gramm–Leach–Bliley Act and the Commodity Futures Modernization Act of 2000, both of which I would have supported as a young man when I was a libertarian, but this is 20 years later, and my knowledge is more aware of complexities of economics and human behavior, and I"m an older ( hopefully wiser) man in the year 2000, and I saw these two acts as a mistake, a mistake that might take a few years to allow for the 'crows come home to roost', and come home to roost they did, in 2008. they weren't the sole reason, but they contributed to it. Bush should have repealed these two bills, but he was a deregulator, so he wouldn't, either. So, both parties must own that crash, in 2008, to be fair.

Most dems will not admit that. But note, those policies were policies that conservatives backed, and it also proved that Clinton was no liberal ( remember 'end welfare as we know it' workfare? These are all neoliberal flavored ideas, Reaganesque ideas ). His policies were good for the short term, but not good for the long term, that is why I'm a liberal progressive/moderate/libertarian-ish. He did stuff I liked, he did stuff i didn't like. Progressive policies they aren't as good for the short term, but they are better for the long term. Libertarian economics is boom and bust economics. Progressive is more steady as she goes, but the numbers don't scream. Trump wants the numbers to scream, but I'm reminded of what happened during the roaring twenties. There was Roar, but there was sulking in 1929.

But I dont agree with progressives on everything, and I agree with libertarians on some things. The problem with it is that most politicians think in terms of the short term, because they are credited and blamed for stuff that happens on their watch. However, if prior presidents did stuff that was wrong, it's on them to do something about it. If he doesn't have both houses, then it depends on his powers of persuasion, which is why you need a strong president, who understands these things, but it's almost inhuman for any one person to grasp it all, and be a great persuader on top of it, let alone get elected.

One thing you can't do, when it comes to economics, is apply simplistic logic to it..

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The notion of tax burden, shared between producer and consumer, is reliant in a sales tax. That can only be partially passed on, and maintain the profit maximisation objective, when there is a level of demand inelasticity. It can only be passed on completely in the unlikely world of perfect inelasticity (i.e. a necessity without any substitutes that has a vertical demand curve).

The analysis completely changes when we are referring to assorted taxes on corporations. A profit tax, for example, cannot be passed on. It makes no logical sense. A windfall tax, in contrast, achieves two aspects: it revenue raises and, as we already have market failure from market power, it generates no deadweight loss inefficiencies. Indeed, given that market failure, it can actually be efficiency improving.

The problem with the US is that individualism is really a soundbite, rather than a reality. There is too much power for big business; there is too little help for small business, as illustrated by low self employment rate. There is ultimately too little tax on corporations.

 

I am still waiting for my reduction in prices after the Trump corporate tax cut. Where is it? How long do I have to wait?

In reality, the tax cut went straight into the pocket of execs, making the already existing outsized wealth disparity worse.

 

Excellent post. I think people make the mistake of thinking income tax is a cost of production, like the OP implied. It, of course, is not, and even if it were, price is still arrived at by supply and demand. If the market price for a Sony TV is $1,200, that's all you will get for it, whether you stole it or paid $5,000 to produce it.

 

No matter how you twist it or spin it, corporate tax is just a another expense on the balance sheet. When they reduce that expense, there are a number of ways to handle it and most, if not all of them were used. It can be used to reduce the cost of the product. It can be used to increase the pay of the employees including the CEOs and other executives. It can be used to increase the profit to the stockholder. Given the power of competition, a major part of it will go to reducing the price of the product. However, by the time that expense is spread out over a number of items, the cost reduction may be no more than a few cents and not noticeable to the consumer.

 

Income tax is not part of the balance sheet. It is assessed based on the balance sheet.

Did you lower the price of your labor because you got a tax cut? Corporations don't lower their prices because of this, either.

 

It is still just another expense on the balance sheet. There is no other way to treat it.

I am retired. However, if I was working, it comes down to my value to my employer and whether they can hire someone equivalent to me for less pay. It is not a case of me lowering the price of my labor. I don't determine the price, my consumer (my employer) does.

 

Income taxes are not part of the balance sheet. A balance sheet lists expenses and revenue, not taxes. Taxes are applied based on the balance sheet. If you don't turn a profit, you owe no tax.

And yet you ignore this when applied to corporations. What you just described is supply and demand. This applies to the price of everything, not just labor.

What the OP is basically arguing is that we live in a command economy, where corporations can raise price at will and survive. This is contrary to the way free markets work. Indeed, it wouldn't be a free market if corporations could do this.

Competition promotes lower prices. Tax policy is irrelevant. If tax policy affected inflation, there would be data to show this.

 

You are correct. There is a serious lack of understanding for business and economy among the general public. People get whipped up by the politicians who want more taxes collected so they can spend it wastefully before they start borrowing again. It is a scam.

 

Profit and loss statement. Balance sheets are about assets and liabilities. But you are right that the general public is just as ignorant about how business works as it is about how government works.

 

Corporate income tax has zero effect on price. The Blue Book value of an automobile remains the same everywhere, whether a car lot expects to pay no income tax or 30%.

 

Lets take your example to its logical conclusion. I am selling my product (my labor) to the consumer (my employer). The consumer, now thinks he can get my product for a lower price elsewhere. He could conceivably decide to pay me less. It is not my choice, until he makes that decision. At that point I have to choose between selling my product at a lower price or not selling it at all. No difference than the corporation.

The tax is an expense to the corporation. No different than any other expense.

 

As I said, the public is mostly ignorant about how business works.

 

You've just made my point for me. Do you not see it? If the owner of Appliance Store #1 gets hit hard by income tax, how many washers and dryers will he sell by attempting to recoup last year's tax expense by raising prices, when Appliance Store #2, who paid no income tax last year, has washers and dryers on sale for 20% less?

Incorrect. There are many different types of expenses. Income tax is not a cost of production. It's levied after production and sales have been completed.

 

So, supply and demand is a fallacy? Just calling people ignorant is not an argument.

 

Well- you are exactly right. Taxes to a business are a cost of doing business, just like the cost of materials and employees. All costs are built into the price of the goods; the consumers of the goods are paying for it, but feeling better when a politician says they are going to stick it to the man so that you get something cheap or free. It's only a choice of how they get the money- but in fact the tax money is built into the product price, and it has to be.

Unfortunately, it's deceptive to the public; they never realize what the real total of their taxes are. Politicians do not want you to know that.

 

When corporations and investors invest they invest in America and much better than government does. And the highest earners and corporations paid more in actual tax revenues after those rate cuts just as with the Gunfight/Kaisch cuts and Bush43 cuts. What is your goal take a higher percentage from the owners of that revenue or collect higher revenues they are not mutually inclusive.

 

I have just illustrated the concept of supply and demand. It works whether it is a corporation selling its product or me selling my labor. If they can get a higher price because the other companies cannot compete, he sells his product at the higher price. If i can sell my labor at a higher price because no one else can get provide an equivalent labor, then I sell it at a higher price. However, I only make that decision to sell cheaper because I have no other alternative. Not just because I can.

Sure it is. In spite of being levied after the production and sales have been completed, the corporation still knows that tax is a liability which must to be paid.

If you want to say it does not apply because it takes place after production and sales, it makes it similar to transportation of the product to the buyer. It is still an expense to the corporation which must be paid and it is figured into the sale price either as a separate expense or as part of the sale price.

 

Price is a product of supply and demand, not tax policy. Did anybody take an economics course?

Nothing is "hidden" in price. Absolutely nothing at all. Markets set price, and producers compete to provide that product, at the market price, while trying to turn a profit. It's really easy to understand. Econ 101.

 

OK. Lets take a look at that. The tax is an expense which someone has to pay.

Supply and demand does not mean simply that is there is a supply and if there is a demand, there will be a sale by that corporation There is also the factor of competition. The government reduces the tax. However, they reduce the tax on the corporation and the corporation's competitors. If the corporation does not lower their price accordingly, the corporation will lose business to their competitors because the demand for their higher priced product goes down.

 

Nothing fallacious about the law of supply and demand nor did I suggest such a thing. You don't understand how business works and I simply pointed that out.

 

Exactly. What does any of this have to do with tax policy? Everyone I work with gets paid according to a scale. It has nothing to do with our individual tax burden.

Income tax has absolutely nothing to do with production costs. Companies use EBITDA (earnings before income tax, depreciation and amortization) to determine operating income. This is what's taxed. Corporations already have their products priced optimally, meaning that they would lose income if price is either lowered or raised. This is determined by the market, not tax policy.

It would be a simple matter to show tax increases were related to inflation. Have at it. Good luck.

 

Lol. You pointed nothing out. Calling someone "ignorant" is more likely a sign of defeat. You got nothing.