The myth about taxes

[Steve]

cost of doing business(TAXES, insurance, salaries ....) being included in the price you paid for the item.

well no shiit Sherlock.  If the cost of doing business was not included in the prcie the business wouldn't turn a profit.
Are you taking crazy pills?

[FUNKED1]

Tweety what you are saying is somewhat right.  But passing those taxes along has some other impacts.  It reduces their ability to compete in the labor market (as an employer) and more importantly it raises the prices of their product.   And due to supply and demand this means that volume decreases as do profits.  So in reality what happens is that the employer eats some of the tax himself, because passing it all on will hurt his profit too much.  It's freshman macroeconomics.  I'm serious about taking a class.  You would love it, and you could have some great arguments with the prof.

[FUNKED1]

BTW Tweety if we use your logic ("The consumer pays the tax money to the manufacturer who pays it to the government"), we can take it one step further.  The employer is the one paying the consumer his wages that he uses to buy the product in the first place!

[Gunslinger]

Originally posted by TweetyBird
>>hmmmm.....how bout the trick is to think about how ANY expense a big bad evil business has is passed on.....OR add as a cost of doing business.

all business pay taxes
<<

Never once said business was evil or faulted them for passing their expenses (including their tax burden) on to the consumer.


Now that second part doesn't add up. If,and you seem to, agree that "ANY expense" (including taxes) are passed on, how do you say they pay taxes? They pass the consumer the tax by adding it to the purchase price, the consumer pays the price, the business takes out the tax portion and sends it off to the IRS. Are you telling me the business PAID the tax and not the consumer, or is it more accurate the business collected the tax from the consumer at the time of purchase?

BTW Steve, this has nothing to do with sales tax which is clearly written on a receipt. This is about the cost of doing business(TAXES, insurance, salaries ....) being included in the price you paid for the item.

I would love to see a price tag that says "10% of the price of this object goes toward Federal taxes."

here's how business pay taxes.  I manufacture widgets.

Cost of material and labor $5
cost per widget for overhead $4

so I sell my widgets to retailers for $12

so for a 3000 widget order I make a PROFIT of $9000.  I am taxed on that money....

NOW if my business costs incresed YES I'm going to sell my wigets for $15 instead TO MAKE THE SAME AMOUNT OF PROFIT...

NOW

Here's were it gets trickey so try to keep up!

My competitors just lowered thier price....you know competition....its a product of capitalism.

Now I have to lower my price to remain competative!

at either price I'm still paying taxes on the profit I make on the products/service that I provide.

so to make a blanket statement that consumers pay the taxes is pretty dumb.

on your line of thinking I could say people dont pay taxes....their employers do because that's who pays them.

[TweetyBird]

>>The employer is the one paying the consumer his wages that he uses to buy the product in the first place!
<<

True! And in return he gets man hours. He's purchasing a product - man hours. Its a resource needed to create his product - kinda like salt. But most people who punch a time clock can't pass the tax incurred (income tax) selling their product (man hours) to the consumer (the employee Edit: EMPLOYER!!!). The only point of this is to show the raw statistic that 20% of the highest income is paying all the taxes is a bunch of hogwash.  And you are correct that freemarket competition makes some manufacturers absorb some of the tax - but certainly not most of the tax. Some is passed to the consumer, some is made by paying less for man hours. In the end, thats the lowest link. The man hour. The person selling only that is paying most of the taxes.

And Steve, 7-11 was out of crazy pills.

What did you mean when you wrote

>>You're trying to confuse sales tax w/ income tax, denied.<<

That was the reason for me telling you I was not talking about sales tax.

You musta got that last box of crazy pills

[FUNKED1]

Originally posted by TweetyBird
But most people who punch a time clock can't pass the tax incurred (income tax) selling their product (man hours) to the consumer (the employee Edit: EMPLOYER!!!).

Yes the employee can (and does) pass on his income taxes.  He increases the price of his labor.  Labor market has supply and demand just like any other market.

[TweetyBird]

>>Yes the employee can (and does) pass on his income taxes. He increases the price of his labor. Labor market has supply and demand just like any other market.<<

I guess theoreticaly thats possible, but I rember a bunch of air controlers that tried to do that in the 80's. It didn't work out very well. Also there is the competition of "undocumented" aliens selling very cheap man hours -ask WalMart.

[FUNKED1]

Supply and demand behavior in the labor market is not theoretical, it's quite real and well documented.  
I'm not an economist, just a geek.  But I'm just letting you know that you are asking me to choose between your view of the situation and the collective view of thousands of scientists who have studied the situation for a few centuries now.  My choice is obvious.  

[Gunslinger]

Originally posted by TweetyBird
>>Yes the employee can (and does) pass on his income taxes. He increases the price of his labor. Labor market has supply and demand just like any other market.<<

I guess theoreticaly thats possible, but I rember a bunch of air controlers that tried to do that in the 80's. It didn't work out very well. Also there is the competition of "undocumented" aliens selling very cheap man hours -ask WalMart.

so you are saying we should tax business more????? or less????

I have no idea what point you think you are making here.  It is a FACT that rich people pay the MOST personal Income taxes....

It is not desputable.

To say that low income familys and middle class pay for business taxes is also dumb because people also pay busineses, electric bill their phone, their property leases, their sharholder dividends, ect....

rich pople spend more money than poor people BECAUSE THEY HAVE MORE MONEY!  that's why they are rich!

Tax the rich. Cut the tax for the rich, they're overburdened.
Cutting taxes for business speeds growth. Class warfare - blah blah blah...

In 2001, the latest year of available data, the top 5 percent of taxpayers paid more than one-half (53.3 percent) of all individual income taxes, but reported roughly one-third (32.0 percent) of income.

The top 1 percent of taxpayers paid 33.9 percent of all individual income taxes in 2001.  This group of taxpayers has paid more than 30 percent of individual income taxes since 1995.  Moreover, since 1990 this group’s tax share has grown faster than their income share.  
 
Taxpayers who rank in the top 50 percent of taxpayers by income pay virtually all individual income taxes.  In all years since 1990, taxpayers in this group have paid over 90 percent of all individual income taxes.  In 2000 and 2001, this group paid over 96 percent of the total.
   
The President’s tax cuts have shifted a larger share of the individual income taxes paid to higher income taxpayers.  In 2004, when most of the tax cut provisions are fully in effect (e.g., lower tax rates, the $1,000 child credit, marriage penalty relief), the projected tax share for lower-income taxpayers will fall, while the tax share for higher-income taxpayers will rise.    

The share of taxes paid by the bottom 50 percent of taxpayers will fall from 4.1 percent to 3.6 percent.  
 
The share of taxes paid by the top 1 percent of taxpayers will rise from 30.5 percent to 32.3 percent.  

The average tax rate for the bottom 50 percent of taxpayers falls by 16 percent as compared to a 12 percent decline for taxpayers in the top 1 percent.


http://www.ustreas.gov/press/releases/js1287.htm

[TweetyBird]

>>Supply and demand behavior in the labor market is not theoretical, it's quite real and well documented.

<<

Yea, well why the hell do unions exist and why does business hate unions. Without organization of labor there is no suply and demand.  See "Grapes of wrath" lately?

The collective view is to hide the fact that you are paying the taxes - not GMC. The collective view is to pretend its possible to lower taxes and increase spending and have no ill effects. You try to get the statistic to follow the tax trail, you'll find them very well hidden among mounds and mounds of usless information.

[Gunslinger]

Originally posted by TweetyBird
>>Supply and demand behavior in the labor market is not theoretical, it's quite real and well documented.

<<

Yea, well why the hell do unions exist and why does business hate unions. Without organization of labor there is no suply and demand.  See "Grapes of wrath" lately?

DING DING DING DING DING DING DING DING DING DING DING DING DING DING DING DING DING DING DING DING DING DING


That's the logic train passing you by

[FUNKED1]

Originally posted by TweetyBird
Without organization of labor there is no suply and demand.

 
Actually organized labor disrupts classical supply/demand behavior.  It's just like a monopoly - bad for everyone except the seller.

[TweetyBird]

>>DING DING DING DING DING DING DING DING DING DING DING DING DING DING DING DING DING DING DING DING DING DING


That's the logic train passing you by <<

Oh well, you got me there, I guess I concede the point. I can't refute that clever point.

[TweetyBird]

>>Actually organized labor disrupts classical supply/demand behavior. It's just like a monopoly - bad for everyone except the seller.<<

Yes it does,  but it is a direct response to business monopolies. And they don't exist? Go shopping for cheap electricity for your house today? Find an emergency room for under $1000 lately?
Spend $5 driving to a gas station to save $3 on a tank of gas?
Notice the price of ALL beef increasing with the fad Adkins diet?
Yea, no monopolies in the business world eh?

You think businesses hate organized labor, watch their jaw drop at the thought of organized consumers. Yea, then you'll see a free market. I guess the only thing a business hates more than organized labor, is an organized consumer action (e.g., a boycott).

[FUNKED1]

The few monopolies we have in the US are heavily regulated.  Want to get rid of utility monopolies?  Cool - refer to California for how that works out.
As far as medical care, fuel, food, there are plenty of choices for the consumer.  And those sectors are already heavily regulated.

Unions are a response to monopolies?  Explain the UAW then?  They are creating monopolies by slowly driving automotive and aerospace companies out of business.  Parasites.

Dude, take an econ sequence, night classes.  I'm serious, you will love it, and you can argue all of these issues with people a lot smarter and more well-informed than me.

BTW if you think my economic views are the result of some kind of right wing indoctrination, remember that I learned them at that noted conservative think tank.  The University of California.