Taxing corporate top lines instead of bottom lines

This plan would kill entrepreneurship as we know it.

Most start-ups take several years to actually show a profit. So, you would be demanding young companies pay taxes on money they don't have...which would effectively bankrupt them.

With taxes on raw revenues, say goodbye to innovation and rapid economic growth.

Bullshit.

Venture capitalists will still invest in companies with a solid business plan.
Venture capital funds a small minority of new firms. You're dooming anyone who uses family and/or personal savings to start a business.

A variable cost on revenue for tax is just that, another variable cost of doing business.
As you no doubt know, variable costs directly limit growth. Raising variable costs on companies that are already cash-strapped is extremely counter-productive.
 
This plan would kill entrepreneurship as we know it.

Most start-ups take several years to actually show a profit. So, you would be demanding young companies pay taxes on money they don't have...which would effectively bankrupt them.

With taxes on raw revenues, say goodbye to innovation and rapid economic growth.

Bullshit.

Venture capitalists will still invest in companies with a solid business plan.
Venture capital funds a small minority of new firms. You're dooming anyone who uses family and/or personal savings to start a business.

A variable cost on revenue for tax is just that, another variable cost of doing business.
As you no doubt know, variable costs directly limit growth. Raising variable costs on companies that are already cash-strapped is extremely counter-productive.

HE SAID corporations, not small startup businesses?
 
What I'm suggesting is merely changing how companies do business. Regardless of whether one thinks it's a good or bad idea, pretending that the market couldn't adapt is both laughable and incredibly naive.
 
What I'm suggesting is merely changing how companies do business. Regardless of whether one thinks it's a good or bad idea, pretending that the market couldn't adapt is both laughable and incredibly naive.

I feel like I'm dealing with a delusional here.
You understand you are NOT proposing to change how companies do business, right? You are proposing a change in how they are taxed. Not the same thing. CHanging how they are taxed might result in a change in how they do business. But it might not. And it is not the most significant part of your absurd proposal.
 
Ribeye,

I'm going to go ahead and mark you down as having an absurdely strong opinion about something for which you understand very little. :thup:

Perhaps even worse than your opinion that libertarians don't believe in law enforcement. :rofl:
 
Ribeye,

I'm going to go ahead and mark you down as having an absurdely strong opinion about something for which you understand very little. :thup:

Perhaps even worse than your opinion that libertarians don't believe in law enforcement. :rofl:

Well, numerous people probably with lots more experience than you, have pointed out the stupidity of what you are proposing. If you won't listen to anyone then there isn't much I can do except write off your subsequent posts as coming from someone who refuses to learn.
 
Ribeye,

I'm going to go ahead and mark you down as having an absurdely strong opinion about something for which you understand very little. :thup:

Perhaps even worse than your opinion that libertarians don't believe in law enforcement. :rofl:

Well, numerous people probably with lots more experience than you, have pointed out the stupidity of what you are proposing. If you won't listen to anyone then there isn't much I can do except write off your subsequent posts as coming from someone who refuses to learn.

I always listen to what everyone has to say. Sometimes it sways me, sometimes it does not. It just so happens that this time, in my most humble opinion, I'm right and you're all wrong. If this idea were to actually be implemented, your prophesies of doom are simply unfounded. The market would adapt, for better or worse.
 
It would adapt by failing to generate new businesses at anything like the rate it currently does. So in that sense, you are right. Of course it is killing the cow to get the milk,but ok.

But you have still not answered the objection that such a stupid proposal would effectively kill most business creation while doing very little to close any loopholes.
Simply denying that is the case isn't an option here.
 
I think the objection is invalid. I understand the theory, I just don't agree with it. I don't believe it would detroy entrepreneurial spirit or business growth at all. I think free market growth is not nearly as impacted by tax policy as current theory suggests. Yes, abrupt changes can cause a correction, but growth balances itself out over time.

But hey, at least we've efficiently reduced our disagreement to fundamental differences of opinion. :)
 
No one said it would destroy business creation. Assuming you mean there would be no, zero, business creation afterwards.
But it would have a serious detrimental effect on it. How serious? I think along the order of 70% less. I know in my own little business I have shown a profit maybe 1 year out of three. If I had to pay tax on revenue instead of profit I would probably have thrown in the towel a long time ago.
Remind what the advantage of your proposal is again.
 
Might it make more sense to tax businesses on their top line sales/revenue rather than their bottom line profit?


Seems to me it would be simpler, making it more difficult to successfully evade. And when I say it would be simpler, that is a massive understatement. The complexity, and therefore opportunities for obfuscation, in calculating profit is truly astounding. In the current landscape, revenue recognition (which is only one component of profit) has grown fairly complex all by itself. But if businesses had to pay a tax directly linked to every dollar of revenue, the incentives to inflate the books would likely be mitigated by the incremental cost and the incentive to deflate the books to avoid the tax would be mitigated by not wanting to report poor performance. Oh, and by the way, a well run, profitable and honest corporation would welcome this because it would save them a lot of money in tax attorneys, accountants and time.

Discuss

PS: Just to state the obvious for those who require it, the rate structure would be a lot lower than the current rates on corporate profit.


And if the business in question is already netting a loss, driving them further into debt would do what besides eliminating more businesses and cleaning the local economies of that many more jobs?
 
The response is that the market will adapt.
Never mind what that means. There is no persuading some people that their ideas are hare-brained and plain idiotic. I think it comes from having no, zero, experience in the real world of starting up and running a business.
 

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