In traditional accounting methodology Tom taxes aren't figured in until you actually make a profit, what you do is determine the rate of return you want and work out the structure it takes to get there. A market will pay a certain amount for a product and they won't pay just any price. Tax doesn't drive the business Tom, it is entirely wrong thinking to think it does

Now if you are operating with a GST that is a horse of a different colour since that is outside the profit structure

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Tax doesn't drive the business Tom, it is entirely wrong thinking to think it does

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No it doesn't ,it is just part of the overhead that has to be captured in the price. What ? You think the business is going to absorb it in their margins ? No ;overhead is factored into the price of a product . Prices are still competitive because all competitors have to pay the tax also.

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Originally Posted by tomder55

No it doesn't ,it is just part of the overhead that has to be captured in the price. What ? You think the business is going to absorb it in their margins ? No ;overhead is factored into the price of a product . Prices are still competitive because all competitors have to pay the tax also.

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Tom when I calculate the cost of a product I don't include tax in the calculation, when I calculate selling price it is judgment call on value. I might have in the back of my mind we have to make a profit, but there are many components of price in a product and they are driven by costs, they are driven by volume, how can tax be factor in what is a fluctuating variable driven by market forces. In your world what tax rate do I use; the nominal tax rate or the effective tax rate? Each competitor is in a different tax position, it cannot influence how they relate to the market in a pricing situation. No one thinks this is the price, I will scale up for tax, next you will be telling me the dividend is factored into the price as a conscious calculation. It is no wonder your markets aren't recovering if your corporations think like this

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I will scale up for tax,

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Agree . Your overhead (including taxes ) has to be factored in the price of your product unless you are willing to let it affect your margins and profits.

You selectively edited what I said taking my words out of context. Is that what republicans are Tom, liars? Manipulators? This is what I said the exact opposite of what you quoted

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No one thinks this is the price, I will scale up for tax,

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The end does not justify the means Tom under any circumstances

So manipulating the tax code for increased profits (like Romney, and the rich do), is the plan of business? No wonder we are in such a mess.

Thanks for proving the business model is BROKEN!!