Posted on 04/07/2020 12:04:07 PM PDT by Farcesensitive
This crisis is demostrating the suicidal nautre of "Just in Time" supply chains. When it is over we need to end the inventory tax in every state.
It is immoral and bad policy to tax wealth that isn't moving anyway but it might just kill us in a crisis.
There are taxes on business inventory?
So then, a company buys products for resale or use in their business, and are taxed on it, when the products have not been sold or used?
There is no inventory tax in Sweden.
Yes, not all states have it but many do.
Businesses are taxed on unsold inventory one or more times a year.
It’s one reason “Just in Time” became so popular.
That’s not the real reason for Just in Time. Inventory ties up cash and can become obsolete or spoil and rot before it’s sold.
https://definitions.uslegal.com/i/inventory-tax/
https://taxfoundation.org/does-your-state-tax-business-inventory/
Because property taxes tend to be locally assessed and collected, the bulk of the revenue generated goes to local governments, meaning that elimination could strain local budgets.
Yep. Even on companies that produce a product are taxed on the parts they use to build them.
That’s not the real reason for Just in Time. Inventory ties up cash and can become obsolete or spoil and rot before it’s sold.
please provide a clear, non-politicized reason for the tax, besides “Mo Munee For Goobermint”.
Can’t seem to find one . ...
we don’t overstate the amount of fuel we have sitting in our fuel tanks. Not sure if that’s why.
Quit abusing the news forum with your vanities.
Sorry.
Well I learned something new today.
It sounds like a tax that a bureaucrat in a tax office thinks is a good idea.
I used to be a machinist in a shop before “Just iniTime”. We had to do inventory once a year. We had to shut the entire plant down, a machine line with 30 machines. Large ones. A ten acre building. Hundreds of employees. Shut down for a week every year. Huge drag on productivity.
whatever....
What pisses me off is that Bob buys a car and the state taxes it. OK, it’s been taxed. The Bob sells that car to Fred and it gets taxed again. And so on... Huh?
We have agreed to so much bullshit in this country. The parasitic professional politicians have sold this country out for 50 years or more. Well, those morons have created a lot of problems for themselves. There will be so many lawsuits over takings and other things after this you won’t be able to get a day in court for years. The tax base is going to go to hell because of all the businesses that these lunatics have killed. Government does not create a penny, what will these dip$hits do when they no longer have the “revenue” to run their overly bloated governments? And now, they have piled trillions on debt backed by paper?
The only good thing is that the market will jump up and down like a Pogo stick. Money to be made there. And, a lot of stuff will be bought cheap in the coming days. Fast forward 90 days and see what the real estate market looks like....
Just in Time = fragile
Even before coronavirus, manufacturers in Canada were having problems with the indians or protestor or whatever the hell they were blocking the railway tracks in Ontario.
“That’s not the real reason for Just in Time. Inventory ties up cash and can become obsolete or spoil and rot before it’s sold.”
That’s the real problem with inventory - tax or not.
Bottom line is that if we want stuff to be stockpiled, then not only do we have to NOT tax it, we also have to have incentives to stockpile (like tax write-offs or something).
“I used to be a machinist in a shop before “Just iniTime”. We had to do inventory once a year. We had to shut the entire plant down, a machine line with 30 machines. Large ones. A ten acre building. Hundreds of employees. Shut down for a week every year. Huge drag on productivity.”
That’s really driven by trying to assess the value of the company, for investors to determine its health. For example, if a company has $10M in a warehouse that is paid for, it is healthier than a similar company with $500k in a warehouse.
So, I think it’s driven by public accounting rules, along with tax rules, for those states. It’s also useful for management to have some clue as to what’s in inventory and what’s not (as things often have a way of walking out the back door).
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