I've heard this guy and somewhat agree with his theory. HOWEVER if anyone out there believes for one second that prices on anything will go down is sadly mistaken. Margins will go up by the amount of any and all taxes not paid. Shareholders will not have it anyother way - I ain't bashing shareholders, as I am one!
You are ignoring the greed of competitors.
Competitive market forces will cause prices to drop. All it takes is one company to drop the price to gain market share and all the rest must follow or die.
Do you not think that retail outlets will not try to drop their price to compete against Wal-Mart, Target, etc... and do you also think that Wal-Mart and others will not drop their price to stave off such attempts?
Think about one recent event and tell me that prices won't fall.
GM announced "Employee Pricing" on all of it's vehicles and sales took off. After seeing their sales drop off, Ford and Chrysler announced their own similar programs.
Did they have to? Nope. But they did because they wanted to stay in business.
This example is only temporary because it was based on cutting profits to sell cars, but it was still necessary for Ford and Chrysler to stay competitive.
When actual costs -- tax and tax compliance -- are removed, the effect will be more permanent.