Golly! Why not just increase income taxes on business until our deficit is gone! Wow! If income taxes aren't in prices, it won't make a bit of difference to business no matter what the income tax is! That's really cool!
Why don't we increase business income taxes to cover our deficit and an annual first class trip to Australia for every family? After all, it won't affect prices, right?
Why not just increase income taxes on business until our deficit is gone! Wow! If income taxes aren't in prices, it won't make a bit of difference to business no matter what the income tax is!
Perhaps you forget the consfiscatory rates which Kennedy abolished. They were practically at that level. During that period prices were very stable compared to today so that is inexplicable in your view of the income tax. Now that those levels have dropped to 38% we have more inflation another inexplicable irony.
In reality I never said that income taxes are irrelevent to business but they are not part of the price formation equations. They affect other aspects of business such as private initative and risk taking.