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Old 09-21-2006, 01:24 AM
pvn pvn is offline
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Join Date: Jan 2004
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Default Why businesses oppose taxation

Many people hear the argument that "the consumer pays all taxes" and then ask "if that's true, why do companies fight taxes and regulation so much? Huh?! Huh?"

The reason corporations lobby against taxes, even though they are passed on to consumers, is that they put the corporation in the position of collecting the tax for free. Corporations have to foot the bill for the collection of taxes in addition to the taxes themselves. Both of these costs are passed onto the consumer, but the government only gets the "benefit" of the taxes that are collected. The resources that the corporation spent on collection are wasted (oh noes, not the "waste" discussion again).

Assume that the government imposed tax has no direct monetary impact - there's no tax to actually collect, government just requires all businesses to fill out 200 pages of paperwork for every $1M in revenue the company collects. The paperwork is shredded as soon as it is received by the government. Would corporations oppose this, even though it doesn't hurt them competitively, since all competitors are identically encumbered?

Do you like doing extra work for no reason?
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