Who pays the tax on corporations? The reduced tax rate on capital gains and dividens is usually justified by?

Retail prices would not fall. Retail prices are based on supply and demand, not cost plus, we learned that in econ 101, didn't we? I know the world is not as simple as that, but I have worked in industrial accounting for a while, and taxes are not considered a cost even when deciding what margins to attempt to get, because only profit is taxed.

No, retail prices would not fall. What would happen? If there was no corporate income tax in america, but other nations still had it, it might spur more investment in the US, because it would likely increase returns on investments (taxes are considered when deciding what return on investment one expects).

But keep in mind, not all companies are owned by tax paying individuals. If the corporate tax was removed, more companies would be owned by non-profits.

I've never understood the argument that the consumer pays the corporate income taxes.

If a company sells a product for $110 that cost them $100, they pay $3 income tax. The profit is hard to predict, they could lose money or make alot of money. As long as consumers buy the product and the company makes a profit, raising corporate income taxes doesn't neccesarily mean prices should rise, just the net income is less.

If consumers are paying the tax, what happens when the company breaks even? The consumer still pays the same price if the costs of producing the goods is the same as the selling price.

Taxes should be used to fund vital government services, not punish success like the Democrats always want to do.

The average middle class taxpayer is paying the majority of taxes that are used to support this government and allow corporations to pay little or no taxes.

Corporations according to a recent study have been able to avoid paying taxes. And today with the offshore accounts that the Bush administration strongly supports, some pay no taxes at all!

Those of the investor class who are paying the low 15percent dividend tax rate, pay lower taxes than a person working for wages and the same applies to capital gains.

So who is supporting the corporations ability to make money? The average wage earner is paying the share for the corporations.

Think about the CEOs making millions and millions a year. If the corporation had to pay a fair share of taxes or return more money to investors, these people would not be making such obscene amounts of money. The distribution of wealth is moving upwards from the middle and working class and the tax structure is encourageing it..

We have wars and our brave soldiers fight along side corporate soldiers making 10 times what they make. Corporations should pay their fair share just like the rest of us do. They benefit so much from the commons like the Court system, the roads, the airways, that we the common people pay taxes to support.

I think consumers definitely pay the corporate tax in higher prices, and if corporate income tax were eliminated, retail prices would fall. My basis for thinking that is the idea that the current average net profit margin for companies (let's say 10%) would continue to prevail after the tax cut -- competition would force companies to cut prices until the same average net margin obtains again through out the supply chain.

In other words, companies are not going to rise to a permanently higher plateau of profitability just because of this tax cut. Competition has a nasty way of preventing that.

The increased tax on cap gains and dividends, and the elimination of tax on the profits of banks and capital lenders probably has some affect that I'm not accounting for though.

Note to "Is it 5 Yet" -- Maybe you were asleep in Econ 101 when they explained that the supply curve can shift right or left, changing the market clearing price, and that its placement is based on supplier costs -- such as taxes. Eliminating the suppliers' taxes would shift the S curve to the right, indicating they'd supply greater quantity at a lower price, dropping the S-D intersection to a lower price point.

the relationship is oblique and not automatic. Inflation consequences from financial coverage. greater financial stimulus is considered mandatory to take care of enhance whilst severe tax expenses preclude the financial gadget from starting to be of course by potential of potential of reinvestment of its very own earnings. it rather is between the justifications why the fee of economic enhance interior the Fifties and Nineteen Sixties substitute into unsustainable - it substitute into boosted by potential of financial coverage because of the fact tax coverage substitute into hampering enhance. and subsequently all of it washed up on the coastline interior the Nineteen Seventies interior the form of stagflation. interior the late Eighteen Nineties the Fed began inflating the money furnish completely unnecessarily - basically because of the fact it may. The financial gadget might have sustained enhance interior the severe 2s, low 3s and asset fee enhance could have been safer devoid of loose funds. yet because of the fact something of the international substitute into starting to be too, a results of loose commerce, significant banks have been increasing their funds furnish and buying greater distant places forex echange reserves alongside with Treasurys. An getting previous US inhabitants and rising distant places center instructions additionally represented greater suitable call for for Treasurys. the federal government chosen to in basic terms borrow on the low expenses and carry spending rather than take great element with reference to the excess because of the fact of decrease borrowing expenditures and pay down debt. apart from the Fed concept "deflation" substitute right into a real concern whilst real expenses fell because of the fact of recent efficiencies additionally generated by using loose commerce, and by using technologies (issues like information superhighway and CAD/CAM), so the Fed inflated the money furnish - lower back, it may, devoid of on the spot CPI enhance, because of the fact real expenses have been falling). finally the Fed overinflated even pondering those factors, and created asset bubbles that it then popped whilst it raised expenses from '04 to '07.