It’s clearly not a tax on business “profits,” and is actually much more like a value-added tax (VAT) because it essentially taxes the value added by each producer in turn as a product makes its way from raw material to final product.
>>It’s actually a 9% business profits tax, plus a 9% payroll tax on business, (plus 9% sales tax, and 9% income tax to the earner).<<
So, essentially, you’re agreeing with me that the business tax is a VAT. After all, the a product price breaks down to: 1) cost of materials + 2) cost of labor + 3) profit margin.
All you’re saying is that the 9% is paid on everything but the cost of materials, i.e., it’s a VAT. The tax is levied only on that portion of the product’s sale price that hasn’t already been taxed as a supplier’s level. That is exactly how a value-added tax is applied.
I don’t understand why Cain is so dense on this point. Either he doesn’t understand it himself (a scary thought) or he’s obfuscating the issue in order to avoid the criticism that he wants to introduce not just one new type of tax (the national sales tax), but two (the sales tax and a VAT).
I think his position is defensible, but can’t understand why he won’t state it in a more forthright way. People aren’t idiots, and will figure it out eventually anyway.