That's because they've listened to people like you who don't know what competition is, that price isn't competition, competing for price is a race to the bottom for business...just ask the US automakers.
If an individual business owner reduces their price equal to the repealed tax, what happens when they go to spend their imagined gain...they'll come up short equal the new sales tax.
No one in business with an ounce of brains will lower their price equal to the repealed tax or they'll be working for nothing.
I didn't miss the math that your paid economist did. I want to see YOUR math using any scenario you'd like to prove YOUR point.
The employer half of FICA is paid on the employee's behalf. If your sales tax is enacted the sales tax includes SS. The employee/consumer now saddled with the entire load of the Federal tax would be entitled to receive the employer contribution....whether you want to admit it or not.
For most businesses the cost of compliance is the cost of TuboTax..about 60 bucks. Other than that it's normal bookeeping.
"If an individual business owner reduces their price equal to the repealed tax, what happens when they go to spend their imagined gain"
The tax is revenue neutral lewislynn, it just shifts the point of collection from throughout the economy to the retail sales register.
If a business owner earns a wage in his company as an employee, (presuming said owner works for his company), such an owner has the same benefit as any other employee through aquiring control over his full gross pay.
Net earnings to the business, and gross wage to employees, remain constant. Compitition operating through supply demand gives rise to decrease in price out of competition. After NRST goes into effect (shelfprice + NRST) = current price. Any earnings advantage goes to the employee in aquiring control over his full gross wage, with the repeal of withholding and FICA.
The primary advantages to domestic business arises out of increased available dollars to the consumer for consumption spending, and an enhanced competitive position with regard to foreign products. Business carves its advance out of enhanced economic growth.
A business owner aquires opportunity to grow in a domestic product friendly tax environment.
No one in business with an ounce of brains will lower their price equal to the repealed tax or they'll be working for nothing.
Then that business is working for nothing now. After NRST net earnings to business and wages to employees remain constant with implementation of the NRST.
I didn't miss the math that your paid economist did. I want to see YOUR math using any scenario you'd like to prove YOUR point.
I did, through the comparative calculations between two economists, Jorgenson and Robbins. If you want to see the math of the source, go look it up lewislynn. I'll accept their studies over anything that can be shown in these brief replies, and especially over anything you come up with.
The employer half of FICA is paid on the employee's behalf.
LOL, you believe what politicians tell you lewislynn?
HELVERING v. DAVIS, 301 U.S. 619 (1937)
- Title VIII(Social Security Act), as we have said, lays two different types of tax, an 'income tax on employees,' and 'an excise tax on employers.' The income tax on employees is measured by wages paid during the calendar year. Section 801 [26 USC 3101]. The excise tax on the employer [26 USC 3111] is to be paid 'with respect to having individuals in his employ,' and, like the tax on employees, is measured by wages.
You are a fool if you do.
For most businesses the cost of compliance is the cost of TuboTax..about 60 bucks.
That most certainly does not include the full costs lewislynn:
Every time Washington collects a dollar in tax revenues, taxpayers shell out that dollar plus another 65 cents. Why is that? It's not that the IRS is inefficient.
That agency's expenses eat up less than a penny of each dollar it raises. The 65 cents is what it costs taxpayers -- businesses and individuals -- to pony up each dollar. Compliance costs, which come to 24 cents, include the expense of keeping records, staying current with the tax code, and filling out the forms. Enforcement costs, close to 2 cents, include tax-???payers' expense for audits and litigation. We spend 3 cents on tax evasion and avoidance. However, the biggest expense item, at 33 cents, is economic disincentive. "By taking away the fruits of labor and capital," says political economist James L. Payne in his book Costly Returns, "the tax system works to discourage working and investing." So the next time Washington announces a, say, $10-billion program, remember that the real cost is that plus 65 cents per dollar -- or $6.5 billion more.
Costs of the Federal Tax System to Taxpayers for Every Dollar of Revenues Collected
Compliance costs 24¢ Enforcement costs 2¢ Disincentive to production 33¢ Disincentive cost of tax uncertainty 2¢ Evasion and avoidance cost 3¢ Government cost 1¢ Total 65¢ Source: Costly Returns, by James L. Payne (ICS Press, San Francisco, 1993).
as well as the fact 80% of dollar volume passes through 20% of the companies out there.
Saying most businesses just don't cut it, lewislynn.
The dollars are concentrated in the few business that are something larger than your single proprietor, cash economy, whatever you can squeak out business where single proprietor takehome equals 100% of gross because they are not "officially" breaking even with even the minimum reporting requirement of individual income tax.
Now I will admit, that kind of business does have a problem competing in an environment where they can no longer use their small size to hide from the tax burdens of the larger businesses they compete with. Yes that "business" is likely to find it tougher going under the NRST. They will have to actually compete for business instead of carving niches in which to hide from the income/payroll tax system.