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Old 01-17-2019, 09:54 AM
 
1,210 posts, read 620,983 times
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Quote:
Originally Posted by ncole1 View Post
This depends on the price elasticity of the product. For products with high price elasticity, consumers have more control over the price than producers do, so what you say would not apply.
NCole1, it's not an exaggeration to state corporate taxes embedded within most individual's annual purchases effectively act very similarly to a flat rate sales tax.

We're not discussing individual transactions, or individual enterprise's, or individual years. It is not general USA businesses' practices to not pass their normal expenses on to their customers. The assumption that I've made is over the years most individual USA enterprises passed most, if not statistically almost their entire normal expenditures on to their customers.

That's manner in which businesses in the USA and almost anywhere else in world is conducted.

It is not dependent upon the individual product, unless you're contending that each USA individual only buys a very few different types of products.
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Old 01-17-2019, 11:43 AM
 
Location: Aurora Denveralis
4,819 posts, read 1,581,829 times
Reputation: 7005
Quote:
Originally Posted by Supposn View Post
...it's not an exaggeration to state corporate taxes embedded within most individual's annual purchases effectively act very similarly to a flat rate sales tax.
You might as well say that the cost of electricity to run the corporation's plants is some kind of "flat sales tax." All cost of goods - materials, manufacture, storage, shipping - are passed on to the consumer. So is an absolutely arbitrary markup ratio, often several levels of it.

So why are corporate taxes - which can be zero and not infrequently are, something you keep pointedly dodging here - any more a "flat sales tax" than the 15% markup between wholesaler and jobber? The only grounds for differentiating two such end costs are that the markup is "profit" (and therefore holy and sacrosanct) and the embedded taxes are just some other form of government theft, an argument I don't buy on any level.
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Old 01-17-2019, 03:23 PM
 
247 posts, read 39,267 times
Reputation: 313
Quote:
Originally Posted by Quietude View Post
Well, okay, but that falls way down the "duh" end of the scale

It is "duh" to you as you know a thing or two, can connect dots, and don't suffer from a lack of ability to logically analyze if-then-else situations (even if you and I disagree on this or that from time to time; reasonable people can disagree).

Sadly, to many people, it isn't "duh." They don't get it. They still keep thinking in terms of "we have to make Evil Corporations pay their fair share of taxes," never making the logical connection that widows and orphans and pension funds for retirees and IRA plans and 401K plans are indeed among the owners of said Evil Corporations. No amount of explanation "sticks" with them. Their brains just are not wired that way. And they vote.

Quote:
Originally Posted by Quietude View Post
despite all the complicated business and tax entities (and their new "personhood"), people are of course at the bottom of it all. If a company makes or loses fifty million, it's eventually in or out of someone's pocket.
Earlier you asked about economic inefficiencies, and I think I never got around to replying. The thing that is inefficient about our current model of taxation is all of those "complicated business and tax entities" that exist almost solely to minimize federal income taxes or some other form of tax. Corporations do indeed spend a huge chunk of resources planning their legal entities (any major Fortune 500 corporation might have hundreds to thousands of separate legal entities) and in transfer pricing scenarios so profits show up in the "correct" (lower tax) jurisdiction -- all of which is -- in my not so humble opinion -- dead weight loss. Total business income tax revenue to the US Treasury fluctuates from $250 Billion to $450 Billion or so each year. Collectively, those same businesses (primarily the large ones) spend another $300 Billion or so (+/-) on tax planning and tax administration. Thus, the total burden on businesses is in the $550 Billion to $750 Billion or so range (give or take a hundred billion) yet the Treasury only gets part of that - the rest is paying for the compensation of both internal and external tax lawyers, tax accountants, IT systems to support it all, and the like.

I can imagine a world (a very, very unlikely world) where my personal tax rate, along with those of others, goes up, and the corporations federal income tax obligation goes to zero, where on balance, the Treasury makes at least as much revenue to pay for running the country. My "IRS Form 1040 Adjusted Gross Income" is a larger, as my dividends will go up, and my capital gains will go up as well (assuming the same P/E multiplier, because of course E goes up). I pay more in federal income taxes. Increase income tax rates to be more progressive than they are today. Overall, everyone can win - except for the legions of corporate tax attorneys who might need to find other ways to contribute to society - perhaps by working in the fast food industry.

It is, of course, a completely academic thought exercise - even though you recognize , as you say, "treating 'corporations' as some kind of independent entity, wholly disconnected from people" is both common and wrong. Can you imagine attempting to explain this concept to Nancy Pelosi let alone AOC?

Yet another approach would be to scrap income taxation for both individuals and businesses (yet another not-gonna-happen thought exercise) and replace it with a progressive consumption tax -- but that's another topic altogether.
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Old 01-17-2019, 04:09 PM
 
Location: Aurora Denveralis
4,819 posts, read 1,581,829 times
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Quote:
Originally Posted by RationalExpectations View Post
Can you imagine attempting to explain this concept to Nancy Pelosi let alone AOC?
I think both would understand it just fine, but they work in the real world of existing laws and regulations in which corporations are not only treated with special privileges, but are now "people" as well.

It's all well and good to sit in your comfy armchair and invent a completely new economic framework where you can ignore current issues and wave away any you dislike, but very few experienced politicians of any stripe are that... whimsical.

(Me, I sit in a very comfy office chair and analyze groundwork for a wholly different economic framework... but with every awareness of the size of the windmill. Also, I'm not elected.)
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Old 01-17-2019, 08:11 PM
 
1,210 posts, read 620,983 times
Reputation: 344
Quote:
Originally Posted by Quietude View Post
You might as well say that the cost of electricity to run the corporation's plants is some kind of "flat sales tax." All cost of goods - materials, manufacture, storage, shipping - are passed on to the consumer. So is an absolutely arbitrary markup ratio, often several levels of it.

So why are corporate taxes - which can be zero and not infrequently are, something you keep pointedly dodging here - any more a "flat sales tax" than the 15% markup between wholesaler and jobber? The only grounds for differentiating two such end costs are that the markup is "profit" (and therefore holy and sacrosanct) and the embedded taxes are just some other form of government theft, an argument I don't buy on any level.
Quietude, regardless of your opposition to the taxes levied upon corporations, we apparently agree as to their effects upon purchasers of their products; excerpted from the previous post, #41 of this thread:
Quote:
Originally Posted by Supposn View Post
NCole1, it's not an exaggeration to state corporate taxes embedded within most individual's annual purchases effectively act very similarly to a flat rate sales tax. ...
... It is not general USA businesses' practices to not pass their normal expenses on to their customers. The assumption that I've made is over the years most individual USA enterprises passed most, if not statistically almost their entire normal expenditures on to their customers. ...
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Old 01-17-2019, 10:30 PM
 
Location: Aurora Denveralis
4,819 posts, read 1,581,829 times
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Quote:
Originally Posted by Supposn View Post
Quietude, regardless of your opposition to the taxes levied upon corporations...
I don't object to corporate taxes. I find the idea of passing all profits through to individuals for taxation nonsensical.
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Old 01-17-2019, 11:08 PM
Status: "Loving the hilarity of CD." (set 9 days ago)
 
5,448 posts, read 2,523,189 times
Reputation: 5323
Quote:
Originally Posted by Elliott_CA View Post
I didn't claim every shareholder personally gets a form from the corporation they invest in.

Every investor knows the standard accounting practice. The SEC 10-Q quarterly report is a the most closely watched statement of financials, with income statements and balance sheets. From Bank of America's 10-Q


Income before income taxes ...................... 8,994
Income tax expense .............................. 1,827
Net income ...................................... 7,167
Preferred stock dividends ......................... 466

Net income applicable to common shareholders ... $6,701


The value of a stock is directly related to earnings. The dividends paid out are also dependent on income available after taxes.
Thatís not correct. Dividends arenít dependent upon income at all.

Quote:
The fact is shareholders bear most of the burden of corporate taxes. You might think it's "nonsense" but the investing world doesn't.
We know the shareholders bear some of the burden. How are you concluding that they bear most of it? Thatís not supported by what you posted above from B of A.
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Old 01-17-2019, 11:11 PM
Status: "Loving the hilarity of CD." (set 9 days ago)
 
5,448 posts, read 2,523,189 times
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Quote:
Originally Posted by DKM View Post
Anyone who works in this field at a high level knows that corporate taxes must be higher than individidual (net) otherwise you're going to see a lot of corporations created for tax evasion.
If you would, explain the tax evasion that you stated above.
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Old 01-17-2019, 11:18 PM
Status: "Loving the hilarity of CD." (set 9 days ago)
 
5,448 posts, read 2,523,189 times
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Quote:
Originally Posted by Quietude View Post
We could assume this is not a one-variable problem and that if corporate taxes were eliminated, the bar would be much higher for forming and maintaining one.

But only in a simplistic model can transferring all taxes to individuals account for corporate income and profits. It's a nonsense scenario.
Itís unclear to me what you mean here. Are you saying that if corporate taxes were eliminated, we couldnít make up the lost revenue simply by taxing individuals, or do you mean something else?
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Old 01-17-2019, 11:24 PM
Status: "Loving the hilarity of CD." (set 9 days ago)
 
5,448 posts, read 2,523,189 times
Reputation: 5323
Quote:
Originally Posted by Quietude View Post
You might as well say that the cost of electricity to run the corporation's plants is some kind of "flat sales tax." All cost of goods - materials, manufacture, storage, shipping - are passed on to the consumer. So is an absolutely arbitrary markup ratio, often several levels of it.

So why are corporate taxes - which can be zero and not infrequently are, something you keep pointedly dodging here - any more a "flat sales tax" than the 15% markup between wholesaler and jobber? The only grounds for differentiating two such end costs are that the markup is "profit" (and therefore holy and sacrosanct) and the embedded taxes are just some other form of government theft, an argument I don't buy on any level.
Storage and shipping arenít cost of goods. Just sayiní.
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