Jump to content

Welcome to the new Traders Laboratory! Please bear with us as we finish the migration over the next few days. If you find any issues, want to leave feedback, get in touch with us, or offer suggestions please post to the Support forum here.

  • Welcome Guests

    Welcome. You are currently viewing the forum as a guest which does not give you access to all the great features at Traders Laboratory such as interacting with members, access to all forums, downloading attachments, and eligibility to win free giveaways. Registration is fast, simple and absolutely free. Create a FREE Traders Laboratory account here.

MHJ

Raising Corp Tax

Recommended Posts

Is it accurate that raising corporate taxes in the current economic climate will eventually yield a wider and deeper recession.

 

You cannot predict with accuracy what will happen in the future if you do X.

Share this post


Link to post
Share on other sites
You cannot predict with accuracy what will happen in the future if you do X.

 

And another way to put it, is that the TV pundits don't understand, you cannot project with any accuracy what would have happen today if x had been done in the past.

Share this post


Link to post
Share on other sites

If history does repeat,then yes. Didn't Herbert Hoover do the same in 1932? Raising taxes in that recession lead to a depression.

First it is my stand that raising taxes on anyone or anything effects each and everyone of us in one way or another. So a tax increase on a select few or on corporations or on capital gains will have an effect on us all, not just the rich, but right down to the homeless windshield cleaners receiving smaller handouts and these "I'll work for food" guys actually having to work for food.

Share this post


Link to post
Share on other sites

In my opinion, it's not so easy to draw a direct correlation between taxes and economic growth. In general, I would agree that higher taxes act as a disincentive for entrepreneurs to get a business off the ground and growing.

 

The part of the equation that also needs to be looked at is how those tax receipts are being used. Is the government investing in growth strategies with the funds they receive? Are they using those dollars to employ people? If you think of the government as just another very large business that collect money for providing services to its clients, I think you'll agree that it's important to look at the revenue and the expense side of things before coming to a hasty conclusion.

Share this post


Link to post
Share on other sites
.............

The part of the equation that also needs to be looked at is how those tax receipts are being used....

 

Yes exactly. If they use the money efficiently or as efficient as we can expect a governmental oranization to be.

 

It can create needed jobs - the dreaded service variety since they don't manufacture anything but the phoney money the Treasury prints. I say dreaded service jobs tongue-in-cheek, after all what are teachers/doctors/lawyers/architects/lobbyists - well forget the last group. ;)

 

But if they are creating jobs for the sake of creating jobs that is just shifting around tax money from one person to another, adding layers of bureauracy and not very efficient at all. Prime example these days is the Homeland Security Dept.

Share this post


Link to post
Share on other sites

The hot topic on the news stations is "We ne to fix Wall Street". Well what about the Government, there is sooooooooooooo much waste it is silly. We need to put someone in charge that can take the country and run it like a business. Raising taxes isnt the answer, locating and fixing the problem is.

Share this post


Link to post
Share on other sites

How can you tax businesses without increasing the price of the goods they produce at every level? Taxes are a part of cost of production. I offer a hypothetical example.

 

Company A produces widgets at the cost of $1.00 and sells at 15% over cost or for $1.15. Government (to the delight of poor customers) taxes the the "rich" businesses 10% so the cost is now $1.10 + 15% so company A now charges the wholesaler $1.27.

 

The wholesaler figures his profits at 25% over cost which is now .12 higher and he is hit with the 10% tax too. So now instead of wholesaling widgets at $1.44 he sells them for $1.59

 

The retailer also must pass on the increase to keep his 50% profits so he retails the goods to the customer at $2.39 for what he sold pre-tax for $2.16.

 

The customer walks out of the store grumbling about inflation and big business sticking it to the little man and goes to vote for the who will make the rich pay their fair share.

 

Meanwhile the government collected 48 cents on every widget to redistribute on their pet projects mostly aimed at enslaving the masses.

 

Hayek got it right in 1947: socialism is the Road to Serfdom.[/I]

Share this post


Link to post
Share on other sites
How can you tax businesses without increasing the price of the goods they produce at every level? Taxes are a part of cost of production. I offer a hypothetical example.

 

Company A produces widgets at the cost of $1.00 and sells at 15% over cost or for $1.15. Government (to the delight of poor customers) taxes the the "rich" businesses 10% so the cost is now $1.10 + 15% so company A now charges the wholesaler $1.27.

 

The wholesaler figures his profits at 25% over cost which is now .12 higher and he is hit with the 10% tax too. So now instead of wholesaling widgets at $1.44 he sells them for $1.59

 

The retailer also must pass on the increase to keep his 50% profits so he retails the goods to the customer at $2.39 for what he sold pre-tax for $2.16.

 

The customer walks out of the store grumbling about inflation and big business sticking it to the little man and goes to vote for the who will make the rich pay their fair share.

 

Meanwhile the government collected 48 cents on every widget to redistribute on their pet projects mostly aimed at enslaving the masses.

 

Hayek got it right in 1947: socialism is the Road to Serfdom.[/I]

 

 

This is a great point. Companies don't pay taxes. Customers pay the taxes in the form of high costs.

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.
Note: Your post will require moderator approval before it will be visible.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.


  • Topics

  • Posts

    • ADMA Adma Biologics stock, watch for a range breakout, target 26 area at https://stockconsultant.com/?ADMA
    • URI United Rentals stock, nice rally off 829 support area, watch for top of range breakout at https://stockconsultant.com/?URI
    • Date: 27th November 2024. S&P500 at its 52nd new peak for 2024; USD Firmer, Kiwi & Yen Up. Asia & European Sessions: Wall Street rallied into the close with the S&P500 and Dow registering more record highs with the S&P500 climbing 0.57% to 6045, its 52nd new peak for 2024. The Dow rose 0.28% to 44,860.3 for its 46th record of the year. The NASDAQ advanced 0.63%. Trump named Jamieson Greer as the US Trade Representative and Kevin Hassett to direct the National Economic Council. Greer was intimately involved in Trump’s first-term trade policy decisions. President Biden announced Israel and Hezbollah have reached a cease fire. Over the next 60 days the Lebanese army and state security will take control of their own territory and Israel will gradually withdraw its forces. FOMC minutes: Minutes from the Fed’s latest policy meeting revealed officials leaning toward a cautious approach to future rate cuts. All agreed to cut the rate by -25 bps and nearly all thought risks between achieving employment and inflation goals were “roughly in balance.” Upside risks to the inflation outlook were little changed, and while inflation had eased, it remained elevated. The implied December rate continues to hover around a 50-50 bet as we await the PCE price data Wednesday and the crucial jobs report on December 6. The January 2025 rate is priced for a total of 20 bps in cuts, with -75 bps by January 2026. RBNZ cut its cash rate by 50 bps, yet the Kiwi gained as traders analyzed the central bank’s rate outlook and the governor’s remarks. Chinese government approved a 500 billion yuan ($69 billion) bond quota, enabling two state-owned asset managers to issue bonds for funding projects aimed at spurring economic growth. Today: US inflation and economic growth may provide clues to the Federal Reserve’s next policy move. Financial Markets Performance: The USDIndex has dropped to currently 106.459. The Yen climbed with USDJPY pulling back to 151.82, while NZDUSD jumped to 0.5900 despite the RBNZ’s 50 bps rate cut. Oil prices stabilized at $68.84, with optimism over delayed OPEC+ output increases balancing the reduced geopolitical risk stemming from the ceasefire. Gold rebounds to 2653.54, with next Resistance at 2660-2664. Always trade with strict risk management. Your capital is the single most important aspect of your trading business. Please note that times displayed based on local time zone and are from time of writing this report. Click HERE to access the full HFM Economic calendar. Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding of how markets work. Click HERE to register for FREE! Click HERE to READ more Market news. Andria Pichidi HFMarkets Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
    • RBLX Roblox stock, pull back to 49.2 gap support area at https://stockconsultant.com/?RBLX
    • UHS Universal Health Services stock, nice rally off the 197 support area, from Stocks to Watch at https://stockconsultant.com/?UHS
×
×
  • Create New...

Important Information

By using this site, you agree to our Terms of Use.