[ams6110]

Why are we paying companies so they have the privilege of taking our money?

Companies don't pay taxes. Ever. Their money comes from customers buying their products and services. If they are not taxed, they can offer a lower price to the customers. If they are taxed, that simply means higher prices for customers.

Ultimately, individuals always pay the taxes.

[mikeyouse]

> If they are not taxed, they can offer a lower price to the customers.

This assumes the owners are targeting some set return rather than pricing their products at whichever point the market can bear, which is a giant, unsubstantiated assumption.

If GM was paying an effective 5% tax rate, which was then cut to 0%, do you honestly think they would lower prices? Yes, I know the theory that Ford would get the same benefit, then lower their prices in competition, but history has repeatedly shown that this is unlikely to result in a price war. Informal collusion is fairly easy to maintain and it's unlikely that the marginal loss in sales from a 5% price premium would be enough to offset an additional 5% booked straight to profits.

[DanBC]

Your argument fails when we see Starbucks selling expensive coffee while avoiding tax.

Starbucks does not avoid tax to give me a good deal. Starbucks avoids tax so that Starbucks can make more money.

[vixen99]

I don't think it does. Any sensible business avoids tax i.e., minimizes its tax bill. If it gets up to what are perceived as evident shenagans to do this, governments can change the law (as has been announced today in the UK) and consumers can decide if they still want to do business with the company. 'Don't drink their coffee' would be the advice re Starbucks, would it not? Good deals usually but not always add up to good business which equates with making more money. If Starbucks offer a lousy deal then presumably they'll either have to change the deal or go down. Plenty of other places to drink coffee.

[Amezarak]

> If they are not taxed, they can offer a lower price to the customers. If they are taxed, that simply means higher prices for customers.

Conversely, if employees were not taxed, they could work for lower salaries. Individual taxation simply means higher labor costs for businesses.

Corporate taxation is part of a complicated system. It's easy to isolate it and say that companies don't pay taxes because they simply pass the costs onto consumers but the same argument can be made the other way, because they're both part of an integral whole.

[ja30278]

It boggles my mind that otherwise intelligent people have a hard time grasping this simple concept. Taxes are simply another cost of doing business, especially if they are applied to whole categories.

Even if they are applied to specific companies (to favor domestic companies, for instance), then they still have largely the same effect, since they allow the domestic competitors to compete in the market inefficiently, raising prices on the consumer.

[mikeyouse]

It's easy to understand that taxes are simply a cost of doing business, but intelligent people disagree that prices would decrease with any certainty if taxes were cut.

Companies don't set prices for products to achieve some specific return, they set prices at the highest point the market can bear. Cutting their tax rate doesn't have any impact on the greater market, so it's unlikely that prices would move at all. The more likely outcome is that owners and shareholders would see higher profits -- which definitely isn't a bad thing, but it's a very different proposition than a general price decrease for consumers.

[dredmorbius]

"If they are not taxed, they can offer a lower price to the customers."

Falsehood. Prices are set by market supply and demand, not tax rates.

A tax may change the quantity of goods or services provided. The price, however, is set by the intersection of the supply and demand functions.

Basic market economics.