Quote:
Originally Posted by dougawhite
No business pays taxes. Their customers pay whatever taxes the business passes through from state or federal authorities. Increase how much a business is 'taxed' just increases how much more their customers have to pay for the product or service. Don't fool yourself that business taxes is ever a solution to increasing government revenues without impacting you and me.
|
According to economists, the cost of corporate taxes are usually split between the companies and the customers, so after a tax increase there will be a modest product price increase. You might think that a company can still try to raise prices to totally cover the tax increase , but it won't work. If they do that, their competitors will sell at the true market price, undercutting them and gaining all the customers.This is assuming the company does not have a monopoly. And it also depends on the product. If consumers decide they can't afford the product, they just won't buy it. But studies have shown the opposite is not true. Did consumer prices drop after the 2017 corporate tax rate cut. NO!