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Let's say they dont kill jobs. How exactly will doing away with the cuts help anything? Seriously, do you honestly believe that Washington will spend that extra money wisely??? Hell no! They will only use it for NEW spending.
I don't have faith the government will spend it wisely. I wish they would guarantee all tax increases would go 100% toward paying down our deficit and none would go to new spending. However, whether increase taxes are a waste or not is irrelevant to my argument that simple saying raising taxes will cause businesses to fire employees based solely on raising taxes 5% on income over $250k.
I'm a small business owner, and I agree that it won't hurt in terms of businesses paying a little more in taxes--nobody fires employees over a small increase in the cost of doing business, especially if cutting that employee would reduce your ability to meet demand. It wouldn't even make economic sense. I wouldn't like it, and I might raise my prices slightly to cover the increased cost, but it wouldn't be the end of the world.
However, I am more concerned about how increased taxes would impact the purchasing power of middle class homes. If you increase taxes and families have less disposable income, that COULD severely impact many small businesses and become a job killer--many families are living on the edge right now as it is, and if you tax them more they will simply stop spending except for necessities. I see that as much more of a job killer than direct taxation of the business. You can work with a small increase in overhead, but you can't work around losing your customers.
well said. raising taxes, even if it was just those making over $250k per year, will have a negative effect on the economy as a whole. prices will go up, or portions will go down, or both will happen. either way everyone will have to pay more to get the same amount of product as before, and that is where the rub comes in.
if the economy were doing fine, like early in the clinton years, raising taxes would not have any detrimental effect on the economy. however, raising taxes in a soft economy like we have now will hurt in the long run.
higher taxes equals less spending for my product, Lower demand and sales equals less cash flow then means that I will have cut back.
TAXES HURT EVERYONE! Even if you are not the intended target?
The negative effect of taxes can trickle down,up, sideways, backwards. It's magic and will effect you. They just are not telling you so you will buy into them going after those evil people who worked hard and now make too much.
Johnathon I understand your point but my experience has been that somehow the middle class always gets hit, And seriously that well is dry ...so now let's go after the rich, well they understand how to make money and take care of themselves.
Aren't they 0b0mba's tax rates now? Didn't he sign that bill? Why does he get a pass?
How can one continue to call tax rates that have been in effect for a decade a "tax cut" anyway?
Just more intellectual dishonesty from the left. Just like when they were called "tax cuts for the rich".
Everyone calls them Bush's tax cuts since it was his idea and they were passed mostly at his behest. Are you going to stop calling healthcare reform Obamacare given that Congress made and passed the bill? Didn't think so.
Please read the entire post before commenting. I want to have a serious discussion and if I see you just read the first couple sentences, I'll just ignore it. Thanks!
The GOP argument: If taxes increase 5% on businesses, they will fire some of their employees to make up for having to pay more in taxes. This will lead to more unemployment, less taxpayers, more people on welfare, and hurt our recovery. This is the basic argument from the GOP. As a business owner whose owned multiple businesses with employees ranging from 7 to 80, I can say this is not reality. Taxes are a burden and of course if I could pay less in taxes, I would. However, the tax rate doesn't effect hiring or firing of employees.
My argument: We have owned numerous businesses from restaurants, retail stores and a hotel. Nobody wants to pay more in taxes than what is required (besides a few billionaires). With that being said, no business owner I know including us would fire employees if taxes increase. If demand is there, why would any business owner want to fire some of their employees which will result in less production thus less revenue. Especially over a 5% increase. It's annoying, but doesn't make it worth closing shop or wanting to stop growth.
The reality is if taxes increase, we increase our write offs by investing back into the business, boosting our own salaries, and anything else that makes sense in order to increase our expenses. We want to increase our expenses, so we will have less taxable income. However, it's not harming our business because by investing back into the business etc we are adding long term value.
Taxes are paid on net income. It doesn't make sense to say "okay taxes are increasing, so let's save money by cutting our workforce in order to offset the increase in taxes". This should make NO sense to any business owner.
1. You are lowering your production, which means you won't be able to handle the same amount of revenue.
2. You are lowering your expenses BEFORE you report taxable income, therefore increasing your taxable income.
You LOSE either way. Say #1 occurs, now instead of revenue of $2 million you now report revenue of $1.75 million. Say #2 occurs, now instead of paying tax on $2 million, you now pay tax on $2.25 million.
I honestly want to know if this makes sense to people out there.
I've heard your argument presented numerous times by many people, but from my experience demand is the only factor that drives hiring or firing of employees.
Pretend you owned a 5 star resort in the boondocks of Nevada and for free could transport it to downtown San Francisco. You would be a fool not to take that offer even though your tax rate would increase increase 10%+ because demand would allow you to increase your rates 10x and your net income after taxes would still be significantly higher.
My argument isn't whether increasing taxes on the top bracket is fair or not, its simply... increasing taxes will NOT kill jobs because demand is the factor in job creation or elimination.
I've not heard anybody making the argument that you claim is the GOP argument. When I or someone else talks about taxes being a job killer, the way I understand it is that it generally refers to:
1. causing companies to not expand
2. causing companies to become less competitive
3. causing companies to relocate jobs overseas
What I haven't seen is an argument that if you raise taxes companies will pay those taxes by firing employees. Most of the time I read "kill jobs" as meaning "reduce job growth"
I've not heard anybody making the argument that you claim is the GOP argument. When I or someone else talks about taxes being a job killer, the way I understand it is that it generally refers to:
1. causing companies to not expand
2. causing companies to become less competitive
3. causing companies to relocate jobs overseas
What I haven't seen is an argument that if you raise taxes companies will pay those taxes by firing employees. Most of the time I read "kill jobs" as meaning "reduce job growth"
this is far more accurate. raise taxes, and you increase the cost of doing business. when that happens, prices go up, quantity goes down, companies dont hire unless they have a REAL need to replace someone.
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