"Do income taxes increase the cost of a good? NO. They aren't even calculated until long after the good has been sold."
Have you ever been involved in the budgeting process for a company? I have, for quite a few. Do you know how many I have included a line item for corporate income taxes on? All of them that were profitable. I found that IF (big if) the company budget was accurate as it related to sales revenue and expenses, we could be reasonably accurate with respect to income taxes. I also found that if I had been with the organization long enough to understand the cost relationships (esp which were sales variable and which were not), then I could forecast expenses very accurately IF (big if again)our sales forecast was accurate. However, the toughest area to forecast on the P&L was the top one - revenue - especially in a fast growth company.
Therefore, to use your logic (or lack thereof), companies cannot predict with a high rate of accuracy either their sales nor any sales related expenses. Therefore, they have no clue as to how to price their product.
You may want to rethink your position.
Another fallacy in logic is your contention that the timing of income tax calculations somehow disconnects them from the business activities that produced them. In fact, one of the fundamental principles in basic accounting is the matching principle. The matching principle says that one of the goals of accounting is to produce financial statements which match revenues with the expenses which are associated with them. I am not aware of any textbook which excludes tax expenses from that goal.
There are, in fact, only a limited number of sources to fund tax expenses from:
1. From operations (meaning from sales minus other expenses)
2. From shareholders (meaning that you sell stock to pay your tax bill periodically)
3. From debt (meaning that you take out a loan from your bank to pay your taxes)
This is WAY more bandwidth than we should be expending to divert ourselves from the real task at hand - which is how do we transition from the current mess of a tax system to one which spells freedom for all Americans and stimulates our economy?
Without accurate projections for sales there is no chance of an accurate forecast for income taxes. Other taxes can be fairly accurately forecast and are included in costs. Income taxes are not an expense and have no bearing on the production decisions. If they are 90% the profit-maximizing production level would be the same as if they were 10%.
Then there are always the decisions of when to expense certain deductions and thereby reduce income taxes. These often cannot even be made until the results for the year are known.
Business income taxes main impact is on capital formation rather than prices.