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To: ctdonath2
Bzzt. Dropping the tax means one less cost in gasoline delivery. Gas stations that don't drop the price accordingly will be undercut and outsold by those that do (having recognized they don't have an extra $0.075+4% overhead to pass on to consumers). The price WILL go down; perhaps asymptotically and never quite reach the full theoretical drop, but it will drop significantly. Now let's make sure he doesn't tack it back on later...

BZZT. Wrong again. Please return to Economics 101. The principle is called supply and demand. The price is set by demand for the existing supply. The consumer does not care what part of the price is cost, tax or profit. Most have no idea of the breakdown. They know what the final price they pay is. If the price is high based on restricted supply, the net price will stay there regardless of how the internal cost structure is configured. I'm a low tax proponent, but this is a futile and foolish act based on emotion, not logic. It will only cost the state revenue, it will not help the consumer one bit other than psychologically.

130 posted on 09/02/2005 12:03:12 PM PDT by CMAC51
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To: CMAC51

Obviously you did not read your Econ 101 text. Neither the supply and demand curves are fixed curves. You play with one the other moves. The intersection is not as simple as the "tax and spend" group around here thinks about it.

The long term key is making the system more efficient. The least efficient part of the cost is taxation. Any thought that holding or increase tax is going to help the situation is not right. Let the markets sort them self out with out government interference.


145 posted on 09/02/2005 1:04:05 PM PDT by Quick Shot
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