Free Republic
Browse · Search
News/Activism
Topics · Post Article

To: JohnKinAK
Corporate Taxes are passed onto consumers, as much 35% of the price of new car is based on Corporate income taxes. You will pay a 9% sales tax on a car that will have it’s price reduced as much as 26%. Therefore, you will realize an overall savings.

John, I think you need to re-visit the numbers. Isn't the federal tax on corporations applied only to the profits? I do not believe they pay 35% on all revenues, just on profits. So the 35% would not apply to the cost of the car, but the 9% would.

39 posted on 10/12/2011 2:09:01 PM PDT by Go Gordon
[ Post Reply | Private Reply | To 7 | View Replies ]


To: Go Gordon

The point is, when a tax is levied against a corporation, that corporation just includes the cost of that tax (and the cost of complying with the tax laws including salary for employee directly employed to comply) in the price of its product or service. Don’t forget the costs incurred to lobby politicians to give certain tax favors, will also ultimately be passed on to consumers. So the customer pays the tax. This applies at any level, and flows all the way to the private citizen who ultimately pays all the taxes. Sometimes it’s a long chain, but all the links are connected, and at the bottom of any product tax chain, is the private citizen customer. So, corporations collect taxes for the government (so that citizens don’t directly see the true cost of govt). It’s just another way the government gets your money! The embedded cost ranges from 22% to 40%, depending on the product and business. Larger Corps have a competitive advantage over small business as they have the political ties to lobby for special considerations under the current tax system. My example was indeed rough, but overall it illustrates the savings. This is the main reason “Jobs are exported”, as its cheaper to comply with the tax codes in China, Pakistan, India and Cananda. As more and more businesses migrate it becomes tougher for US businesses to remain competitive.


58 posted on 10/12/2011 7:02:57 PM PDT by JohnKinAK
[ Post Reply | Private Reply | To 39 | View Replies ]

Free Republic
Browse · Search
News/Activism
Topics · Post Article


FreeRepublic, LLC, PO BOX 9771, FRESNO, CA 93794
FreeRepublic.com is powered by software copyright 2000-2008 John Robinson