The case you suggest is actually the exception rather than the rule. There are almost countless examples of one supplier setting their price at the market price rather than a price based on their individual supply curve. This is the case in all commodity markets, and is very common in cases where we see monopolistic compe ion (which is not monopoly).
True statement.I dare say if the market will only bear a price lower than the cost to produce/provide, the company won't produce or provide -- or -- they will sacrifice in one of the areas already mentioned.
You're going to have to rephrase your question, because I don't understand what it's trying to ask.But, back to the other question, from where do the dollars to satisfy the suppliers side of the equation come?
I don't think so. Taxes are usually based on a percentage of gross income. I doubt any corporate bonus -- at Subway or elsewhere -- has approached the percentages the IRS expects in corporate taxes.
And, I'm saying it's done when the individuals that hold stock or ownership pay their taxes, when employees pay their taxes, and when customers pay sales taxes.
And, I think we'd be better served with a federal sales tax replacing all the imputed taxes already infecting commerce.
"...but burden is split between producers and consumers..."
From where do producers get the money to satisfy their portion of the burden?
What the IRS expects and what the IRS gets are two different things. I agree that I doubt many large companies pay 35% of their net income at the end of the year in executive bonuses (though not at all unheard of for small companies - and there are lots of examples of executive bonuses being well above 35% of Net Income - even well above 100% - even incalculable because the company didn't make a profit).
But, do you real think it is unheard of for a company to have executive bonuses on par with their actual income taxes paid in a given year?
But they don't necessarily. There is a distinct disconnect between Net Profit and dividends, especially as a company grows larger.And, I'm saying it's done when the individuals that hold stock or ownership pay their taxes,
This is quite the stretchwhen employees pay their taxes,
But this is fair argument since sales taxes, though levied on the consumer, are really "paid" by both parties (the split of the burden determined by the respective elasticities of supply and demand).and when customers pay sales taxes.
It would be one approach, but one I think has problems due to the variability of elasticities of supply and demand - but not an unnecessarily unsolvable problem.And, I think we'd be better served with a federal sales tax replacing all the imputed taxes already infecting commerce.
You do realize that sales taxes also impact a company's profitability, right?
From the profits they otherwise would have earned.
"Thinking at the margin" Yonivore. C'mon, you can do it.
Running away from the computer now, be back later.
It doesn't cost you market share if your compe ors have to make similar cuts.
And I think you overrate companies' expertise with regards to finding the optimal marketing budget. There are a ton of wasted ad dollars out there.
I would suggest you might be surprised. But my point is that if cuts on the supply side of the equation would be significantly detrimental to their business, there would be pay cuts.I don't know what type of bonuses Subway awarded last year but, I would suggest the bonuses awarded to any of the companies of which you would criticize for doing so, are a speck in the ocean that makes up their balance sheet.
And, if the profits didn't go to taxes, what would happen to them?
Don't insult me, I'm going somewhere with this.
See you later.
One last tidbit before I go actually:
A $X sales tax on an item doesn't have the result of rising the price of the item by $X.
So if there is a $1 tax placed on Widgets, and as a result the price of Widgets goes up $0.75, then that $0.75 was the burden on the consumer and the $0.25 is the burden on the producer.
Okay, leaving for real now.
That suggests everyone's product is identically produced and, therefore, there's no difference. Might as well be just one sandwich business.
Each business has a formula for taking their assets and producing a product at a price that is compe ive or (as scott points out) that the market will bear.
But, it's their money to waste. That doesn't give the government the right to confiscate it just because they don't think it's wise. How are advertising firms expected to make a profit and remain compe ive?
No, I doubt I'd be surprised and, pay cuts also damage business.
I understood the premise but, I have the same question.
Who pays the $0.25?
Any countless number of things. Provide jobs, invest in new equipment, issue a dividend, pay for lobbyists, go to the executive bonus plan, sit in a giant safe for Scrooge McDuck to swim around in...
Dude, I won't insult you if you don't act like a dunce. If you're going somewhere with your points, just go there. No need for me to walk you to the school bus.Don't insult me, I'm going somewhere with this.
See you later.
Literally, or effectively?
Running off again. Back late this PM.
Of course they would have a reason to pander. They would pander to corporations who wanted other things like less regulations or government contracts. Not to mention companies are not the only thing that they pander to. They also pander to lobbyists from "family values" groups and others who want to affect social policy.
Either.
Salaries go to individuals.
No doubt, purchased from suppliers whose assets and liabilities are also shared by individuals.
To individuals.
Also individuals.
More individuals.
An individual fowl.
Every penny of asset or liability, in a corporation, belongs to or is the responsibility of individuals...either collectively or individually. Corporations don't pay taxes. The people who directly affect them do, from employees to consumers to suppliers.
That's my point.
That $0.25 burden in your example is going to directly affect the wealth of individuals.
In 2009, Subway sold $3.5 Billion dollars worth of $5.00 Foot Longs. If my back of the envelope math is accurate, that's $175,000,000 worth of quarters that make up the suppliers burden while the consumer picks up the additional $525,000,000 if, in fact, they're still enamored with a $6.00 Foot Long.
Last edited by Yonivore; 12-19-2011 at 10:23 PM.
^Taxes don't go to individuals too? Do they get sucked into some economic black hole?
So does not collecting the $0.25 burden. Everyone understands this. What's your point?
It wouldn't be a $6.00 foot long. It'd be a $5.75 foot long in my example.In 2009, Subway sold $3.5 Billion dollars worth of $5.00 Foot Longs. If my back of the envelope math is accurate, that's $175,000,000 worth of quarters that make up the suppliers burden while the consumer picks up the additional $525,000,000 if, in fact, they're still enamored with a $6.00 Foot Long.
But what's your point again?
Corporations don't pay taxes, individuals do. The money used to pay Corporate Taxes is drawn from the wealth of individuals and directly affect their individual stakes in a corporation.
Same as above.It wouldn't be a $6.00 foot long. It'd be a $5.75 foot long in my example.
But what's your point again?
Um... yeah, that's kind of the point of them.
I'm not sure everyone sees it that way. And, since you agree, would you also agree the vast majority of those stakeholders are not in the 1% and are, in fact, regular people who have retirement accounts, pensions, etc... invested in corporations?
Corporate taxes are paid by everyone who invests in that company. Many of whom are depending on their investments in some of these companies for their sustenance.
That was my original point. Calling them Corporate Taxes makes them impersonal. It allows groups like Occupy to demonize an abstract and injure real people.
What other way do they see it, and why does it matter?
Why does it matter?And, since you agree, would you also agree the vast majority of those stakeholders are not in the 1% and are, in fact, regular people who have retirement accounts, pensions, etc... invested in corporations?
And a significant chunk of stock ownership is, in fact, owned by the 1%. The disparity between the number of shareholders and the distribution of ownership in a company kind of goes along with the whole inequality argument being waged.
That's the point, because otherwise it isn't a true statement without Corporate Taxation.Corporate taxes are paid by everyone who invests in that company.
Even if true, are you suggesting that you think tax policy should be tailored to suit people who "need" the money.Many of whom are depending on their investments in some of these companies for their sustenance.
And in any event, who are these people who depend on stock dividends for sustenance? And what ty financial planner helped them make that arrangement?
Make them as impersonal or personal as you want, they still need to get paid. The people sustaining these "injuries" seem to be doing alright.That was my original point. Calling them Corporate Taxes makes them impersonal. It allows groups like Occupy to demonize an abstract and injure real people.
Isn't it ironic how people don't realize they will pay more for US products by increasing corporate taxes, and less by decreasing them?
Want to return some jobs to America and have less leave... reduce or eliminate the productivity tax!
"less by decreasing them"
bull , you have no proof that lower corporate taxes result in anything but the savings being sucked up by mgmt and investors
When oil hit $140 in 2008, the oilco industry gave us a break, refused to suck in windfall profits of $10Bs, and held down the price of gas so as not to damage the US depressed economy even more, right?
G M A F B that lower/no taxes means lower prices.
There are currently 1 users browsing this thread. (0 members and 1 guests)
Posting Permissions
Reply With Quote
