Trey asked in Politics & GovernmentPolitics · 4 months ago

Why are democrats so stupid as to think high corporate taxes are paid by the corporation instead of the consumer?

If you tax a corporation they're not going to say "oh well, I guess I have to lower profits" they'll get their profits back by raising prices on the consumer!

17 Answers

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  • Mike
    Lv 7
    4 months ago
    Favorite Answer

    Its a added hidden tax , You buy something you are paying the employees Health Insurance ,Shipping All the bills etc.

  • 4 months ago

    That only works if the consumer is willing to pay the higher price instead of buying a similar product made in a foreign country. When that happens the corporation starts laying off people and/or making plans to move to a country with lower taxes so they can stay in business.

  • 4 months ago

    They know they are paid by people, but it will cost jobs, and more people dependent upon the government dole, which means more DNC drone voters.

  • 4 months ago

    I’m a Democrat and also a corporate tax attorney.

    You are grossly oversimplifying. Most corporations don’t sell directly to consumers. In addition and more importantly, a higher tax, like any other cost, may be managed in a number of ways without increasing prices and the resulting revenue.

    All corporate profits subject to tax are the excess of revenue over costs. These are called earnings and profits under section 312 of the tax code. Higher taxes cut into profits, resulting NOT in a need to increase prices, but more directly in reduced amounts available for dividends under section 316. The first thing any corporation will do in the face of higher taxes is cut dividends.

    Moreover, corporations CAN’T increase prices as much as they wish because if the have already set prices properly they will already have prices at a level that maximizes profit without reducing purchase volume per unit.

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  • Anonymous
    4 months ago

    Just be like corrupt hillary clinton and start a tax free "foundation"

    • -j.
      Lv 7
      4 months agoReport

      Number of 2016 presidential candidates who had to shut down their foundation for "a pattern of illegality": 1

      Number of those who are HIllary Clinton: 0

  • Murzy
    Lv 7
    4 months ago

    True .

  • 4 months ago

    Attempting to teach economics to liberals is a waste of time.

  • Yavan
    Lv 7
    4 months ago

    Well, I'm glad you understand that…

    Now apply that reasoning to tariffs and it should tell you just how stupid trumpism is.

  • -j.
    Lv 7
    4 months ago

    To a point, yes. But there is a thing called price elasticity which means you can't just jack up prices as far as you want, whenever you want. This is the same argument Republicans make against minimum wage hikes. "Then every car will cost $80,000!"

    Uh, no they won't. Cars, like most goods, will be priced at whatever the market will bear.

    • -j.
      Lv 7
      4 months agoReport

      So more people will be buying? Good, that's how economies improve. Much better than letting inflation outpace wage growth, which is when nobody buys anything and economies collapse.

      Glad we agree, wage growth is good.

  • Anonymous
    4 months ago

    Correct and not unlike tariffs.

    Exploding deficit and debt + inflation is not a good thing.

    By the way, at least with corporate profit the profit is going to the shareholders such as people with 401ks. With tariffs, the money is going straight into the US Treasury. Corporate profit is a good thing. Taxes/tariffs...not so much.

    ...and believe it or not, I'm a dem. But thanks for calling me stupid, I guess.

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