Re: [gang8] Re: Gov't Investment for VOW: Who Pays?

["John O'Donnell" <jackodonnell@xxxxxxxx>]

Schulte-baeuminghaus wrote:
>
> John,
>
> VOW does NOT look to tax hikes. VOW would like to see tax cuts for the lower
> income-earners.
> How?

"How?" indeed! How can one expect to find solutions when one
restricts oneself solely to transaction taxes such as VAT,
and/or taxes on retail sales, personal and corporate income,
etc.?

This is a particular problem given the fixation on the
present forms of taxation. For example, take the typical
analysis of corporate income taxes that are allegedly
"passed on" to consumers implying in the analysis that this
is true of all corporate taxes but that income taxes
supposedly paid by wage earners or sales taxes supposedly
paid by consumers cannot be passed on.

Because all competitors are forced to pay the same taxes on
labor and sales, the costs can be passed on to consumers.
However, if a tax is imposed on corporations based on the
value of the corporation rather than on its income or that
of its employees then the tax can not be passed on and the
owners pay through reduced valuation of the corporation. In
fact, although the costs of other forms of taxation APPEAR
to be passed on, because of fewer sales caused by price
increases needed to incorporate the "passed on" taxes, the
value of corporations are reduced anyway. The only
difference is the amount of damage done to the economy by
such pass throughs.

Not only that, but a corporate property tax [I call it a
"monopoly tax" because it becomes part of the cost
to maintain ownership or "monopoly" of the corporation.
Alternatively, I call it a "limited liability license fee"
because that is what it is.]  can be structured to CAUSE the
greatest rate of growth of capital [i.e. -- the value of the
corporations.] The model that demonstrates this is on line
at:
http://www.geocities.com/jackodonnell.geo/widgets.html with
an explanation beginning at:
http://www.geocities.com/jackodonnell.geo/c04r4a.html and
continuing at:
http://www.geocities.com/jackodonnell.geo/c04r4p2a.html

The full analysis begins at:
http://www.geocities.com/jackodonnell.geo/c00r4.html

Comments invited.

<<SNIP>>

--
			-- jbod

		Tax Privilege, Not People
___________________________________________________
Come visit and see a new economic perspective --
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           Comments/arguments welcome.
.