Your math is a bit oversimplistic. Corporate tax is applied to profit not gross sales. Using your sale price and assuming a 50% profit margin gives a before-tax profit of $2000. With $800 in labor costs this implies $1200
in non-labor costs. A pre-tax profit of $2000 with a rate of 20% implies a $1600 after tax profit. That would be reduced to $1300 if the rate remains 35%.
In Mexico, assuming the same non-labor costs and a 20% tariff, the pre-tax profit is $4000 - $1200 - $800 - $142 = $1858. Assuming Carrier qualifies as a resident corporation after moving, a 22% tax rate applies giving an after-tax profit of $1449.24 per unit sold.
Obviously, for remaining in Indiana to make economic sense, the US corporate rate would need to be cut, something Trump has promised but it isn’t a certainty. Carrier is betting on Trump to succeed in this regard.
Another point where the “math” of the left makes no sense is their squealing after this was announced that Carrier was bribed to stay by the $7 million in tax breaks it got. Using your values for average labor costs and ignoring other factors, this falls flat on its fave. The difference in average wages is $23 per hour. Multiplying by 40 hrs per week and 52 weeks per year gives a savings of $47,840 per employee per year. With 1,100 employees that’s $52,624,000 per year in potential savings by moving to Mexico. Why would carrier give that up for a one-time tax break that is valued at less than 1/7 of its yearly savings in labor costs?
There are other considerations to be accounted for in that math. The costs of complying with the overzealous EPA is pretty huge, not to mention all the other alphabet-soup federal agencies that are micromanaging business in the US today. And don’t forget the costs associated with Obamacare, which have skyrocketed.
Trump and company have a lot of work to do to unravel the mess that our government has created for the business world in this country. The cost of compliance has to be outrageous these days, but don’t expect the mainstream media to report on that.
“Your math is a bit oversimplistic.”
You are obviously way more into it than I.
But I think you’ll agree that the oversimplistic illustration I provided would give the accounting department of most companies food for thought.