alexey Posted May 3, 2012 Share Posted May 3, 2012 Please help me understand this: Somebody pays $10 for a trinket. Company pays the supply chain, taxes, utility bills, etc. Company has $5 left for profit and for employees' labor. Who earned what? How is that decided? What happens if the unemployment is high and mid-low people will work for peanuts? Thank you. Link to comment Share on other sites More sharing options...
Willy Wonka Posted May 3, 2012 Share Posted May 3, 2012 It is decided by voluntary exchanges and agreements. Things like taxes are not voluntary though so less is actually gained by those who actually benefit from your example. If unemployment is high and the people are willing to work for less, it is probably because it is better then any other available option that they have. Link to comment Share on other sites More sharing options...
Darth Tater Posted May 3, 2012 Share Posted May 3, 2012 In a true market economy? Opportunity costs. The perceived optimal uses of the resources in question. In a socialist economy? Whatever the masters decide.. Link to comment Share on other sites More sharing options...
skinsmarydu Posted May 3, 2012 Share Posted May 3, 2012 Read "The Fair Tax Book". No further explanation will be needed, I promise(with hope). I have heard about the second one that addresses questions about SS in the future, but haven't read it yet. Still hoping we can wrap our heads around a consumption tax. Best idea. Read the book. It's a quick one, and keeps you going, you want to make it work,...at least I would like to. Link to comment Share on other sites More sharing options...
Darth Tater Posted May 3, 2012 Share Posted May 3, 2012 Read "The Fair Tax Book". No further explanation will be needed, I promise(with hope).I have heard about the second one that addresses questions about SS in the future, but haven't read it yet. Still hoping we can wrap our heads around a consumption tax. Best idea. Read the book. It's a quick one, and keeps you going, you want to make it work,...at least I would like to. The marginal net rate of the all taxes (all taxes paid less all benefits received as a percentage of income) is very high between 30K and 85K after which it decreases towards 0 as you go up the income ladder (those at 30K or less have a net rate less than 0). That is, the highest net burden is upon those who make between 30K and 85K, While there are provisions to keep the real low income earners from these marginal net rates, the net rates of a consumption tax (if you wish to replace the income tax totally), would make the situation worse. Also, in a way, income tax IS a consumption tax since most of the taxable income is income that must be kept liquid for consumption requirements. Finally, a consumption tax likely would kill the marginal producers hurting the marginal consumers even more. If one assumes that the current real size of government is about right, a wealth tax is conceptually the only FAIR form of taxation. Link to comment Share on other sites More sharing options...
zoony Posted May 3, 2012 Share Posted May 3, 2012 Sales - cost of goods sold = margin Margin- expenses = profit You can't figure the profit before you've made payroll. That comes after Link to comment Share on other sites More sharing options...
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