Did you know businesses do not pay taxes?

Question

When taxes rise they just raise their prices so it us the consumer that pays more taxes and businesses don't.

I read this somewhere and am looking for what you guys think.

Answer 1

No, you are not correct -- companies (other than non-profit corps) do pay taxes.

Yes, they may still offset those taxes by raising prices -- so their net profit is still the same -- but the taxes are still being paid -- the govt still gets the money, and it comes (as it always does) ultimately from the people -- companies are just intermediaries.

Answer 2

You are mistaken about the tax thing. Many companies do not actually raise prices when the taxes rise, the reason for this is that many of them recognize that this would cause more people to find other locations to do their shopping. So many of these companies are not able to offset enough of the rise in taxes to make it worth it until the taxes has been raised considerably. However you are talking mostly the sales tax changes.

The taxes that the consumer does not see often times is the property taxes that these companies pay. These taxes go up on a yearly basis and there is little any of those companies can do to offset these taxes, the reason I say that is that they do not know what the taxes is going to be from year to year. These taxes actually take a good chunk out of the profits of any company. There are also different tax rules for businesses that cannot be passed on to the consumer as much as onewould think, but, yes, sales tax, excise tax and things like that are passed onto consumers.

However, how well do you like your roads, your public school system, the many different things the government provides? Without us footing the bill, through paying these various types of taxes we would not have those things. So in the end I have come to the conclusion that paying more taxes is not a bad thing. Would you like to see a national healthcare plan put in place? If you would taxes is where the money is going to come from.

There is little to no money kept and put into a savings account from year to year to pay for the billions of dollars in public goods and services we get from year to year. So taxes is important, and I guess I am one who does not complain about having to pay taxes.

Answer 3

Businesses still pay taxes even if they raise their prices. They could raise prices so that they still make the same profit but that doesn't mean they don't pay taxes. Say tax equals one dollar and the price is 10 dollars. Tax is raised to 2 dollars so price is raised to 11 dollars. They still pay the tax but profit remains the same.

Answer 4

I'm not sure of their logic but try this convoluted explanation: Businesses treat taxes as expenses so to offset increase expenses the Business will increase revenue. Easiest way to increase revenue is to increase the price of the products or services you sell. Always netting out the increase, plus a little for your effort. Therefore businesses are not pay taxes they are passing them along to US THE CONSUMER. So we get to foot the bill again. Good plan.

Answer 5

Business do in fact pay taxes. First you have to pay all of the withholding tax. Then unemployment taxes, than income tax, Property tax, State taxes.

Now their are times when a state may try to get a business to relocate to their state and they may get a good deal on the taxes.

Answer 6

Of course businesses do not pay taxes. The consumer does! All corporations do is set aside a little money from each sale and then remits it to the appropriate govt agency, ( IRS, State, Local, school tax , property tax, etc etc.)
We all know that!

Answer 7

Yes, of course. The profit margin must remain the same. Margins are tight to remain competitive. They still have to pay the tax bill.

Answer 8

Revenue (sales inflow) - Expenses (cash outflow) = Profit

Companies pay taxes on the profit. If a company is "in the red" then they don't (and shouldn't) pay any taxes.

Answer 9

I read the Holocaust never happened, but that does not mean is didn't. They raise prices, then wages go up, then prices go up. Then people won't buy their products and then hey might have to cut prices.

Answer 10

this has always gone on. in fact, did you know that if a business doesn't show enough of a profit, they get subsidized. if you don't support ron paul, please take a long look at him. there is a reason the government and media hates him. please find out what that is.

ron paul has over 50,000 volunteers for his campaign. the largest ever for a presidential candidate. just imagine, we are still 13 months away from the election.

50% of total military campaign contributions are going to ron paul. out of 20 candidates, ron paul gets 50% of the military donations. find out why.