[woodbeez]

If income taxes are only 2% of revenue, if you remove the income taxes - how much could prices go down for WalMart? No more than 2%.

Since taxes are computed on income, not revenue, and income is what determines if a company is successful or not, you must compare income tax as a percentage of income. WalMart pays 35% of its income to income tax.

Revenue - Expense = Income.

[Always Right]

Since taxes are computed on income, not revenue, and income is what determines if a company is successful or not, you must compare income tax as a percentage of income. WalMart pays 35% of its income to income tax.

The question is not what percentage they pay of income, that has no bearing what so ever on how much they can reduce their price with the elimination of the tax. You need to compare the amount of tax with their gross sales to how much Wal-Mart could reduce their prices. Your analysis is meaningless.