Passing the Cost to the Consumer from a Business Owner's Perspective

originally posted by: schuyler
That's why it is insanely stupid to hear people say, "X business doesn't pay their "fair share" of taxes and they ought to pay more!" Good God, how stupid can you get? All that means is that you are asking for the price to go up. YOU are the one that is going to pay every single dime of those 'corporate taxes.' And then you wonder why the government gets bigger and bigger and you get poorer and poorer.

You have summed up the Original Post quite succinctly. No corporation is ever going to pay a tax increase. Big, medium or small.

a reply to: AugustusMasonicus

So should we simply scrap all corporate taxes and increase income tax by the same amount?

originally posted by: DietJoke
So should we simply scrap all corporate taxes and increase income tax by the same amount?

I am personally of the opinion that a flat tax on all earnings would be better than the tax code morass we currently are saddled with.

originally posted by: DietJoke
a reply to: AugustusMasonicus

So should we simply scrap all corporate taxes and increase income tax by the same amount?

Doing that would give citizens a better idea of the taxes they really pay. Right now it is a hidden tax. Right now when I buy a widget it looks to me like all this money is going to the corporate coffers. In fact, the corporate income tax is a part of the cost of the widget. Right now I'm under the illusion that I've got my taxes on one side and my costs of goods on the other when really the costs of goods contains a great deal of taxes all by themselves.

The thing is, the employees pay full income taxes and the share holders pay full taxes on any dividends they may make. If they happen to make any capital gains when they sell shares that's supposedly taxed at a "reduced" rate of 15% but guess what? Your real tax rate is close to that anyway. (Add it up after all the deductions and such and you pay from 15-18%).

The idea that "corporations are getting away with not paying taxes!" just puts a smile on the government's face. THEY know where the taxes really come from: the consumer, but consumers are so hyped up on corporate hatred that they support raising taxes and the infamous "loopholes!" when what they are really saying is,

"Please raise my taxes!" People think they are "sticking it to the evil corporations!" when what they are really doing is sticking it to themselves. It's completely insane. Then they turn right around and complain about the cost of a gallon of gas. Hellllooooooo! When you look at a pie chart of costs, taxes is a much bigger slice of the pie than "profit" is. You want to know who REALLY stands to lose if someone comes out with a real "Zero Point Energy" device? The government. The loss of revenue would be unacceptable.

originally posted by: AugustusMasonicus
Minimum wages go up? You pay the increase.

Presumably, you are speaking of employing people at minimum wage or below the new minimum wage for this to be true. It would not affect anyone over the raised minimum wage.

Business only staff as much as it takes to run day-to-day operations, correct? No more and no less than is necessary (taking into consideration sickness rate, holidays, etc).

If taxes (or even the minimum wage) decreased, would you then hire more people?

a reply to: AugustusMasonicus

I had to recall memories to answer this question.

I think she had all the same problems that the modern businessman has. She just did not whine and complain, she overcame.

originally posted by: Greven
It would not affect anyone over the raised minimum wage.

Is that so? Joe works for me part time and gets $8 per hour. Cathy works full time and gets $12. The minimum wage goes to $10.10. Joe gets an effective 20% raise and makes much closer to Cathy than he did before. You think she will not ask for a raise?

If taxes (or even the minimum wage) decreased, would you then hire more people?

I most likely would put it towards capital improvements or expansion.

originally posted by: MOMof3
I think she had all the same problems that the modern businessman has. She just did not whine and complain, she overcame.

And how did her lack of complaining and whining mitigate the annual cost of business increases so she did not have to raise her prices ever?

originally posted by: AugustusMasonicus

originally posted by: MOMof3
I think she had all the same problems that the modern businessman has. She just did not whine and complain, she overcame.

And how did her lack of complaining and whining mitigate the annual cost of business increases so she did not have to raise her prices ever?

It didn't.
People just won't admit being wrong usually.
That's what it's about.

Sigh....

a reply to: muzzleflash

Hey, I was a kid. To give a honest answer, I would have to make it up.

I just think she was an amazing person. She gave all natural birth to 16 children, started her own business, managed her farm (her husband was the manager) and taught school part time. I never heard her complain about money or paying her taxes. And this was in the South in the 1960's where it was hard for a woman to do anything. She overcame, something we expect the poor to do all the time. But the modern businessman seems to have the attitude that he/she is special and it should be easier.

The way things seem to work makes it look almost like a long term plan.

You cannot tax companies into oblivion and expect low wage earners to fill in the gap spending money they don't have with companies that charge so much to make up for their tax costs....

Gee, it's obvious why everything seems to be falling down and collapsing around us when people have to take out a goddamned loaned to pay the cost of just surviving, to actually pay more than they earn to keep a roof over their head and eat.

Debt is the ultimate invisible trap and works on nearly everyone without their ever even really noticing since they can easily get mindless entertainment piped right into their cramped little dirty cage.

How much does it have to hurt before people realize they don't even need all that useless garbage they buy to make the pain go away and quit buying it?.

More DEBT sir?, yes please and thank you for allowing me to hobble myself further!.

This much?...

The whole thing is a trap.

originally posted by: MOMof3
a reply to: muzzleflash

Hey, I was a kid. To give a honest answer, I would have to make it up.

I just think she was an amazing person. She gave all natural birth to 16 children, started her own business, managed her farm (her husband was the manager) and taught school part time. I never heard her complain about money or paying her taxes. And this was in the South in the 1960's where it was hard for a woman to do anything. She overcame, something we expect the poor to do all the time. But the modern businessman seems to have the attitude that he/she is special and it should be easier.

No you wouldn't have to make it up, since you can use math to determine only one reality exists in economics.
If suppliers raise prices, either retailers raise prices or will lose.

Please review this info :Cognitive Dissonance

In psychology, cognitive dissonance is the excessive mental stress and discomfort[1] experienced by an individual who holds two or more contradictory beliefs, ideas, or values at the same time. This stress and discomfort may also arise within an individual who holds a belief and performs a contradictory action or reaction.[2]

Leon Festinger's theory of cognitive dissonance focuses on how humans strive for internal consistency. When inconsistency (dissonance) is experienced, individuals largely become psychologically distressed. His basic hypotheses are listed below:
"The existence of dissonance, being psychologically uncomfortable, will motivate the person to try to reduce the dissonance and achieve consonance"

"When dissonance is present, in addition to trying to reduce it, the person will actively avoid situations and information which would likely increase the dissonance" [1]

Confirmation Bias

Confirmation bias (also called confirmatory bias or myside bias) is the tendency of people to favor information that confirms their beliefs or hypotheses.[Note 1][1] People display this bias when they gather or remember information selectively, or when they interpret it in a biased way. The effect is stronger for emotionally charged issues and for deeply entrenched beliefs. People also tend to interpret ambiguous evidence as supporting their existing position. Biased search, interpretation and memory have been invoked to explain attitude polarization (when a disagreement becomes more extreme even though the different parties are exposed to the same evidence), belief perseverance (when beliefs persist after the evidence for them is shown to be false), the irrational primacy effect (a greater reliance on information encountered early in a series) and illusory correlation (when people falsely perceive an association between two events or situations).

Cherry Picking

Cherry picking, suppressing evidence, or the fallacy of incomplete evidence is the act of pointing to individual cases or data that seem to confirm a particular position, while ignoring a significant portion of related cases or data that may contradict that position. It is a kind of fallacy of selective attention, the most common example of which is the confirmation bias. [1] Cherry picking may be committed intentionally or unintentionally. This fallacy is a major problem in public debate.[2]

a reply to: muzzleflash

Ok, then using the powers of reasoning. The store was opened until she retired. I am sure she raised prices, that is only logical. But, it was in Mississippi, so she must not have raised them that she was short of customers. She did give her customers credit, no interest. I know that when she died she was debt free, passed on an inheritance to her kids.

originally posted by: MOMof3
But the modern businessman seems to have the attitude that he/she is special and it should be easier.

Your grandmother's personality, birthing habits, familial relationships and stoic demeanor have nothing to do with deferring cost of business increases. She, like every other business operator, had to deal with them the same way; take less profit and possibly jeopardize her business and family or raise prices.

The fact that she opened, managed and operated a business means that at one time she was a 'modern' business person. She epitomized the American Dream, she was her own boss.

I admire her resilience and business acumen.

Your distortion or reality, not so much.

originally posted by: MOMof3
I am sure she raised prices, that is only logical.

So is she greedy like me? Like every other business owner that has ever run a business?

That was rhetorical, then answer is 'no'. She was smart and knew how to make money.

We only pay the business' increased costs if we chose to and are able to! Otherwise the business loses customers.
Unless of course the business has buddies in congress willing to mandate that spend our money in the business!!!

What the op says it true for the small businesses or what is left of them and I don't think that most of the posts that want to tax the businesses more are really aiming at those small businesses. I don't believe there that many small businesses that have offshore tax havens. Most of them have a more personal relationship with their employees and are more willing to pay them a little more money if they find value in them as employees.
It's the big corps that I think are the problem where policies are made in an office far away from the employees by someone who probably has never met any of them nor do they care to. Cookie cutter policies designed with only one goal to bring profit to the business for the sake of the shareholders The leave no room for a personal touch to solve the personal problems that the employees might be encountering So if one of those employees encounters a problem which might cause the lose of the employee even (like losing his mode of transportation due to an insanely low wage) well it doesn't matter how much the manager values that employee or how hard the employee works for the company The manager cannot provide the employee a raise even if he has to Even if he values that employee so much that he is willing to play taxi driver just so the employee can make it to work!

And those big corps also will just pass the cost down to the consumer as they feel that they have no moral obligation to pay their employee enough so the employee can have a roof over his head and a meal every day and pass that cost down to the taxpayer.

But well what happens when the employees are no longer able to pay the higher cost for your goods?
And well in the old times of slavery wasn't a master restrained so that they could only have as many slaves as he could support?
And if your business can't operate providing an affordable product to the customers while supporting your workers aren't you in fact operating your business on a failed business model and we the taxpayers are being drained to keep a bunch of failed business models afloat?

There are many avenues that one could take to turn a failed taxpayer propped up business model into a healthier one
Maybe instead of just passing the costs on down to the consumer all the time they could try a little creativity and find a better solution? I mean sooner or later you will find that you costs have surpassed the ability of the people to pay and well then you have no customers And I really think we are about at that point.
And in many companies I am sorry but they has plenty of money that are passing out in giant bonuses and paychecks for their upper management while we the people are paying for their employees to have the basics!

Failed business models are causing a failed economy

originally posted by: dawnstar
What the op says it true for the small businesses or what is left of them and I don't think that most of the posts that want to tax the businesses more are really aiming at those small businesses. I don't believe there that many small businesses that have offshore tax havens. Most of them have a more personal relationship with their employees and are more willing to pay them a little more money if they find value in them as employees.
It's the big corps that I think are the problem...

The size of the business is not really relevant. No matter how your word or work the tax codes they are never going to pay taxes. You are going to pay every single penny.

Failed business models are causing a failed economy

They only cause a failed economy when we bail them out. The bankruptcy court procedure worked for over two centuries before the last two cretins decided to muck it up and hand out our money for failed business practices.

a reply to: AugustusMasonicus

Perhaps I do have a reality distortion, too simple. I believe that the times are not favorable for the small businessman. All the tax breaks and laws are tilted in favor of "too big to fail" corporations. The small businessman and laborers need each other.

Lowering taxes sounds like a good idea. But you make it sound like that businesses have no responsibility for the burdens of country. You want customers/laborers to pay all your costs, the costs of wars and social programs.

At one time, this was fine when we had full employment and there were not two wars.

originally posted by: MOMof3
I believe that the times are not favorable for the small businessman. All the tax breaks and laws are tilted in favor of "too big to fail" corporations. The small businessman and laborers need each other.

Any tax break favors the consumer as we are the ones paying the taxes on both ends. The bailout paradigm is ludicrous and is not conducive to a healthy economy. It is part of the natural business order that companies will form, grow and possibly fail. When we remove the risk of loss it corrodes the economy and rigs the market in favor of those who have influence.

g taxes sounds like a good idea. But you make it sound like that businesses have no responsibility for the burdens of country. You want customers/laborers to pay all your costs, the costs of wars and social programs.

They already do. I do not understand why this is so hard for you to grasp. Businesses not pay taxes, consumers do.

'We the people' foot the bill for everything no matter where you collect it from. It is a zero sum game, the dollar either comes from the left side, your personal taxes, or the right side, the money taxed on the goods and services you buy and remitted by the businesses you patronize.

time, this was fine when we had full employment and there were not two wars.

All of that is irrelevant to the Original Post. War or peace. Good times or bad. Boom or bust. You are always paying the taxes.

a reply to: AugustusMasonicus

Here is my where my reality is going to really frustrate you. I have never minded paying my taxes.
I lived and worked in good times. From 1968 to 2007. I could get a job anywhere, health insurance was offered at every job, pay my bills, buy a home and a car, take a yearly vacation. Now, people are working just to make it to the next paycheck.
And we had our war, Viet Nam. Only they did not come home in the thousands with life long injuries like the two current wars.