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Post by judes on Mar 4, 2011 11:49:50 GMT -6
If companies could do as you say Supposn and generally pass their costs to consumers they would never go bankrupt. Of course in our corporate plutocracy, too big too fails don't go bankrupt and costs do get passed on to consumers in the form of taxpayer bailouts, but that is another issue all together. It is a fallacy to contend that employers FICA contributions are passed to consumers as Unlc and Gray Beard have correctly pointed out.
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Post by supposn on Mar 4, 2011 19:30:32 GMT -6
Gray Beard, my question was do employers GENERALLY pass their portions of FICA contributions onto their customers?
I agree (and stated) they on occasions cannot and/or choose not to do so.
Respectfully, Supposn [/size][/size][/quote] Judes, determination of an enterprises’ net incomes are often complex. Major segments of our nations bookkeeping, accounting and legal industries are devoted to the defense or prosecution, or challenging the “determined” amounts of net incomes. Enterprises’ directly paid income taxes GENERALLY reduce owners’ incomes derived from their enterprises. Determinations of enterprises’ gross payrolls are generally much simpler (than determining net incomes). FICA contributions (based upon payrolls) are equally and directly paid by wage earners and their employers. Employers’ FICA contributions, similar to all of enterprises’ normal expenses are GENERALLY passed onto their customers. Most commercial enterprises could not survive if they attempted to “buck” their industries’ practices of generally passing their FICA contributions onto their customers. Respectfully, Supposn
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twk
Contributor
Posts: 58
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Post by twk on Mar 14, 2011 9:50:15 GMT -6
We may need full blown tariffs to fix things, but I do not believe it is going to happen. The plutocracy does not want Tariffs. I think converting payroll taxes into a simple retail sales tax (NO VAT) is a good idea and it is like a mini tariff and many here believe that tariffs are the right thing to help fix our economy. A sales tax removes some of the complexities of running a business and it helps the tiny business the most and tiny businesses operate under different constraints than larger organizations. Tiny businesses are very likely to use local labor and more likely to buy local materials compared to a large organization. Or at least buy materials from a local distributor, but the parts may be coming from a non local source. Keep in mind that it is very, very hard to buy electronics widgets that are made in America, especially electronics components that are used to make complex electronic devices. Here is a small electronic hobbyist company that is trying to operate in this environment. It gives an example of the complexities of tariffs. It also tells me that a lot of stuff that is already labeled "Made in America", is arguably NOT made in America, but just assembled here. ==================== www.sparkfun.com/We build a heck of a lot of stuff here in Boulder. In fact, next week we estimate we will produce our 1,000,000 widget! That's a lot of assembly, testing, and design work going on right here in Colorado. But I'm often surprised by just how big the supply chain is to be able to put together some of these widgets. What is really Made in the USA is actually Made in Earth. We depend on each other's countries to produce the best of what we're known for. Why did this come up? We're getting more and more requirements to mark the products we sell with a 'country of origin' certificate. This is needed when our customers or distributors try to import our products into their perspective countries. Customs agents in Brazil need to know whether the product came from the USA, or from Ireland, or from Mars. We started asking ourselves - where do our products come from? If we build stuff here in Boulder, is that the country of origin? What about the COO (country of origin) of parts we solder to a board? Let me give you an example: The Si4703 FM Receiver breakout board is relatively small and simple, but it has a whole host of parts on it - 31 in fact. Here is the image of the parts spread sheet: sparkfun.com/tutorial/news/COO.jpgResearching these parts online looking for COO can be very difficult. It's easier to walk over to the production floor and take a look at the reels and bags of components. Almost all are clearly marked with a country of origin. I was surprised by the wide mix of origins. Resistors for this build can come from Thailand, Taiwan, Israel, or China. Capacitors may come from Taiwan, USA, Israel, or China. Japan seems to have cornered the market of magnetics. The ICs come from Singapore and Mexico. Did you know the TPA6111A2 has 0.0794mg of gold in it? That's like $0.003957! Officially, we are completing what's called a transformational process on this breakout board. We significantly change the raw materials to the point that we have created something new. We can now claim that SparkFun USA is the country of origin for this product. Alternatively, if we imported orange juice from Mexico then added water and called it Horange Juice, the country of origin would still be Mexico. My point here is claiming that "Made in _____" is good/bad is largely misleading and often politically motivated (read up on trade tariffs). We want you to know that the parts and products you buy from SparkFun are Made in Earth. It's time for a big world hug.
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Post by graybeard on Mar 14, 2011 10:31:58 GMT -6
100% inspection of imports - paid by the importers - will fix some of the confusion about COO. If it comes into one of our ports of entry, it's imported and must be inspected, and tagged appropriately.
GB
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Post by unlawflcombatnt on Mar 14, 2011 12:17:20 GMT -6
I think converting payroll taxes into a simple retail sales tax (NO VAT) is a good idea and it is like a mini tariff and many here believe that tariffs are the right thing to help fix our economy. How is that anything at all like a Tariff? A sales tax would be applied to domestic goods as well as imports. A Tariff is only imposed on imports. A straight sales tax increases the after-tax price to consumers, thus reducing demand for the product. Applying this to both American-made and foreign imports reduces demand for both. Tariffs only reduce demand for imports.
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Post by blueneck on Mar 14, 2011 15:53:55 GMT -6
I recently heard a suggestion on a program that sadly I can't remember which, that I think has some merit and worth exploring - waiving sales tax on US made goods.
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Post by graybeard on Mar 14, 2011 17:20:50 GMT -6
Waiving sales tax on domestic production would work good until imports decreased. What then?
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Post by supposn on Mar 15, 2011 21:03:50 GMT -6
A straight sales tax increases the after-tax price to consumers, thus reducing demand for the product. Applying this to both American-made and foreign imports reduces demand for both. Tariffs only reduce demand for imports. Unlawflcombatnt, commercial enterprises’ expenses are (generally) passed on to their customers. Regardless of anyone’s acceptance or rejection of this statement, it’s the basis of your writing “A straight sales tax increases the after-tax price to consumers, ……”. I agree with this first part of your sentence but you continued to write “thus reducing demand for the product”. I disagree with the last portion of your sentence. We generally accept that increasing prices of a goods or service will reduce the effective demand for that product. We’re accustomed to potential purchasers’ reluctance to buy when obvious price increases have been enacted. Limits of potential customers’ resources lead them to purchase lesser quantities or lesser qualities of the products or seek alternative products, or do without the benefits provided by the products. To the extent that that limited types of products are subject to “selective” price increases and they are not considered as necessities or forefill a great need for their purchasers, their sales can be expected to fall to some extent and remain less than otherwise as long as their prices relative to other products are perceived as “pricey”. When such products are considered as necessities or forefill a great need for their purchasers, their sales volumes are lesser affected. They may initially decrease but they recover to significant extents. We’ve witnessed this scenario many times with regard to gasoline price increases. A general sales tax (as the name implies), is applicable to ALL general goods and services. There's no practical alternative product to consider. After the initial blush of a newly enacted or increased general sales tax has worn off, total gross sales amounts, (i.e. total of products plus sales tax revenues) return to nearly approach (if not meet) their prior levels. Respectfully, Supposn
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Post by supposn on Mar 15, 2011 21:41:18 GMT -6
I recently heard a suggestion on a program that sadly I can't remember which, that I think has some merit and worth exploring - waiving sales tax on US made goods. Blueneck, there’s no federal sales taxes to waive. If a federal sales tax were waived upon U.S. produced products, it would be a tariff rather than a sales tax. States have difficulty collecting their sales tax revenues due to products passing into their states (as opposed to transactions entirely within their states). All governments I’m aware of waive their sales taxes upon products exported beyond their jurisdiction. There’s no economic or political justification for a state to waive their sales tax for U.S. products produced outside of their state. Respectfully, Supposn
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Post by unlawflcombatnt on Mar 16, 2011 2:01:21 GMT -6
I recently heard a suggestion on a program that sadly I can't remember which, that I think has some merit and worth exploring - waiving sales tax on US made goods. Blueneck, there’s no federal sales taxes to waive. If a federal sales tax were waived upon U.S. produced products, it would be a tariff rather than a sales tax. States have difficulty collecting their sales tax revenues due to products passing into their states (as opposed to transactions entirely within their states). Most states do have sales taxes. In California, which comprises about 1/8th of the US population, the sales tax is 9-9.5%. If the Federal government decided to offset that tax with a subsidy of some sort if California dropped it on US-made goods, it would make taxable American-made goods 9-9.5% cheaper than foreign-made goods. That would make US-produced goods 9-9.5% cheaper than foreign goods for about 39 million Americans. That's no small difference. And it would certainly change the pattern of which goods California stores put on their shelves. All American-made products would suddenly be a lot cheaper. That's a ridiculous argument. Most stuff is still sold in retail stores in the involved state, and is still subject to state sales taxes. A majority of states DO have hefty sales taxes, especially the large ones like California. And if the Federal government offered to reimburse states for their lost sales tax revenue on American-made goods, a lot more states would elect to put sales taxes on goods sold within their state.
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Post by supposn on Mar 16, 2011 4:24:36 GMT -6
Unlawflcombatnt, your entire message is based upon federal heavy subsidy or entire reimbursement of states’ waiving their sales taxes upon U.S. products.
I haven’t attempted to count the likely votes in the House and the Senate. U.S. senators and representatives from non sales tax states will generally be opposed to subsidizing taxes of other states.
If the proposed federal act is not limited to states’ currently enacted sales taxes, such a federal act would motivate states to enact or increase state sales taxes and those taxes will be heavy sales taxes. States will also be motivated to reduce their other state taxes; those lost revenues would be entirely replaced by federal reimbursements of lost state sales taxes.
A federal sales tax waived upon U.S. products would be simpler, of lesser federal expense and/or a more feasible act; that would actually be a federal tariff.
If the proposed federal act is limited to states’ currently enacted sales taxes, it’s more likely to be opposed by senators and representatives from states with no or lower state sales taxes. There’s also the loss of votes from proponents of smaller federal government and/or no increases of federal spending.
Respectfully, Supposn
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Post by unlawflcombatnt on Mar 16, 2011 16:43:53 GMT -6
A federal sales tax waived upon U.S. products would be simpler, of lesser federal expense and/or a more feasible act; that would actually be a federal tariff. Yes, that would be a lot simpler and lot better. And it would essentially be a Federal tariff. That's exactly what I advocate--Tariff or Federal tax that is applied only to foreign-made goods, but waived on domestically-produced goods.
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