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No matter what I try, unless you include taxes paid by the employee, it is impossible to come up with 22% of embedded taxes.

I agree with you totally, the "embedded taxes" are just not there except for the payroll and income taxes on labor. They are not even saying 23% of the cost of the product, they are saying there is 23% of the SELLING PRICE which includes the profit margin.

Another way to point out how ridiculous this is:

If you assume that the payroll taxes are 15% and the average income tax about 8%, then there are 23% in income and payroll taxes in the labor component of the SELLING PRICE of products. For services the cost is almost all labor.

If we then add this additional 23% phantom embedded taxes to the quanitfiable income and payroll taxes, this would mean that 45% of the SELLING PRICE is taxes in some form.

Considering a profit of 15% of the selling price, this would mean that the remaining 85% of the SELLING PRICE is the cost of producing the product. If we believe that there is 23% embedded above and beyond the income and payroll taxes then 45/85 = 53% of the cost of a product would be tax-related.

This is obviously ludicrous.

For services the cost is almost all labor.
I've asked several times (though I know the answer) which part of service costs get cut to reduce the service price 20 to 30%...

BTW, They can't show you how you how it can be done (because it can't). It's always the other guy who's going to do it then force you to do the same.

i'm late on this one, but i see that some still insist that he 22% or 23% or whatever, is made up of taxes only.

It isn't.

The 22 or 23% or whatever does include taxes - but that's not all - not by a longshot.

No wonder you don't see taxes as 23% of prices - NOBODY does. What some are saying is that tax and tax costs combined come to 22 or 23%.

How can some continue to omit costs of compliance (of which there are three main types - NOT simply planning/accounting/litigations)?

Perhaps they deny the existence of any costs other than the tax paid itself?...talk about ludicrous.

A company who spends millions on planning and executing tax minimization may have a zero tax bill... does that mean no tax related costs are in the price? Of course not.

What about a decision made based solely on tax cnsequences that closes a plant in Utah in favor of opening a replacement in Mexico?

Your eyes are closed by choice, Rob. Your position does not hold water.