More money that will quickly disappear into the government waste. Why do people think Apple, let alone any other company pays taxes? No YOU the customer pay the taxes in the form of higher prices which pay for the taxes. You're really only taxing yourself yet again, over and over and over. You don't realize how much money the government is stealing from you, if you sat down and started adding it all up.
Apple pays more, YOU pay more.
More money that will quickly disappear into the government waste. Why do people think Apple, let alone any other company pays taxes? No YOU the customer pay the taxes in the form of higher prices which pay for the taxes. You're really only taxing yourself yet again, over and over and over. You don't realize how much money the government is stealing from you, if you sat down and started adding it all up.
Apple pays more, YOU pay more.
You'd better stop smoking these weird substances.
How on earth can I be paying more if a government taxes the profits, a company makes in some country? Apple will not change its investments or product strategy because it has to pay taxes on the profits it makes.
Taxes on profits are calculated on the total profit figures a company makes and are charged typically charged more than 1 year after the sale of a product. Apple, as any other company cannot come to me one year after I bought my Mac saying: hey you have to pay another 3% because we received a tax bill.
Nor can Apple anticipate the tax by an increase of selling price, because the profit is calculated on the total of all products, acquisition, financial earnings, .... One can calculate the margin on individual items like a iPhone, an Mac or an Apple Music subscription, but one cannot calculated the profit of individual items; the revenue of other items influence the profit positively or negatively. One can assume that the margin on Apple Music subscriptions is lower than on iPhones, so it impacts negatively the average profit percentage of Apple. If Apple buys a company, it is a deductible expense for the taxes on profits, and Apple does not know 1 year upfront the conditions of a potential acquisition.
Besides there is a market that plays; Apple cannot increase its prices without impacting the market.
Oops, missed the point. Way back when the prices of products are set, the company that produces the product factors in all costs of doing business, to attempt to ensure a profit after everything is paid. And since new products are developed and introduced on a constant basis, you can be certain that this year’s changes in tax expenses are folded into this year’s and next year’s product prices. Since this has been going on since.. taxes... you can be sure that all the products you’ve ever bought had taxes factored into their prices. That’s how on earth.
A lot of people make this general claim about corporate income taxes. But it's generally mistaken; corporate income taxes aren't, generally speaking, effectively passed through to consumers.
A lot of taxes on businesses do function, effectively, as pass-through taxes on consumers. It depends on how the tax in question works. A tax that effectively adds to the incremental cost of sales typically would function as a pass-through tax. An income tax, which takes a given percentage of profits, typically wouldn't though. The notion that it would depends on a faulty premise: That companies desire to make a certain amount of after-tax profit and choose not to make more than that amount even though they could (and even though there wouldn't be unacceptable offsetting harms in doing so). The notion is necessarily based on the idea that companies don't want to make more than a given amount of profit.
If a company believes that raising the price of a given item, in response to a higher income tax rate, would - all things considered - result in a higher pre-tax profit which would thus allow it to make just as much after-tax profit as it would have with the (previous) lower income tax rate, then why wouldn't that company raise the price of that given item even without a higher income tax rate? It would mean making more after-tax profit. If X is greater than Y, then 80% of X is greater than 80% of Y just as surely as 75% of X is greater than 75% of Y.
If a company doesn't raise the prices of items, it's because it doesn't think that doing so is in its best interests - e.g., because doing so would reduce sales volume by an amount that would erase the gain in per-sale gross profit, or because doing so would hurt brand loyalty and future sales. There are lots of reasons why companies don't raise prices above where they are, but those reasons remain, for the most part, regardless of the income tax rate applied to overall profit.
An excise tax, e.g., functions quite differently from an income tax and thus can have the effect of making it a sound business decision to raise prices whereas it might not have been a sound business decision to raise prices absent that excise tax. It adds to the cost of each item sold and thus reduces the gross profit from each item sold. The math behind weighing the number of items sold against the amount of gross profit made from each item sold, at given prices, is changed. With income taxes which are calculated by applying a percentage to pre-tax profits, the way to maximize after-tax profits when that rate is 25% is the same as the way to maximize after-tax profits when that rate is 20%: Maximize pre-tax profits. (Here I'm only referring to how income taxes - and changes in income taxes - function in general. There can be some nuances in how income taxes are applied which, in limited circumstances, mean that changes in tax policies make it make sense to, e.g., change the prices of some things. But that's not the general case.)
If we believe that a given company desires to make a set amount in after-tax profits, and makes decisions intended to avoid it making more than that set amount, then... yes. A higher income tax rate might mean that company raises prices to get back to that set amount of after-tax profit. But most companies don't operate that way. If higher prices would, in their assessments, mean greater profits at no cost to, e.g., their images or ability to grow over the long term, then they'd have those higher prices anyway.
Now... higher business income taxes can mean a lowered (expected) effective return on capital and thus can affect how attracted to business ventures (in general or in particular) capital is. Higher income taxes can, e.g., affect whether certain business activity is engaged in or whether certain businesses are able to raise the capital they need in order to succeed. Similarly, higher income taxes on labor can (at least in some cases) affect whether there's enough (expected) effective return on labor which one might engage in, or on incremental amounts of labor one might engage in, to justify one's decision to engage in it. But those are different considerations.
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A lot of taxes on businesses do function, effectively, as pass-through taxes on consumers. It depends on how the tax in question works. A tax that effectively adds to the incremental cost of sales typically would function as a pass-through tax. An income tax, which takes a given percentage of profits, typically wouldn't though. The notion that it would depends on a faulty premise: That companies desire to make a certain amount of after-tax profit and choose not to make more than that amount even though they could (and even though there wouldn't be unacceptable offsetting harms in doing so). The notion is necessarily based on the idea that companies don't want to make more than a given amount of profit.
If a company believes that raising the price of a given item, in response to a higher income tax rate, would - all things considered - result in a higher pre-tax profit which would thus allow it to make just as much after-tax profit as it would have with the (previous) lower income tax rate, then why wouldn't that company raise the price of that given item even without a higher income tax rate? It would mean making more after-tax profit. If X is greater than Y, then 80% of X is greater than 80% of Y just as surely as 75% of X is greater than 75% of Y.
If a company doesn't raise the prices of items, it's because it doesn't think that doing so is in its best interests - e.g., because doing so would reduce sales volume by an amount that would erase the gain in per-sale gross profit, or because doing so would hurt brand loyalty and future sales. There are lots of reasons why companies don't raise prices above where they are, but those reasons remain, for the most part, regardless of the income tax rate applied to overall profit.
An excise tax, e.g., functions quite differently from an income tax and thus can have the effect of making it a sound business decision to raise prices whereas it might not have been a sound business decision to raise prices absent that excise tax. It adds to the cost of each item sold and thus reduces the gross profit from each item sold. The math behind weighing the number of items sold against the amount of gross profit made from each item sold, at given prices, is changed. With income taxes which are calculated by applying a percentage to pre-tax profits, the way to maximize after-tax profits when that rate is 25% is the same as the way to maximize after-tax profits when that rate is 20%: Maximize pre-tax profits. (Here I'm only referring to how income taxes - and changes in income taxes - function in general. There can be some nuances in how income taxes are applied which, in limited circumstances, mean that changes in tax policies make it make sense to, e.g., change the prices of some things. But that's not the general case.)
If we believe that a given company desires to make a set amount in after-tax profits, and makes decisions intended to avoid it making more than that set amount, then... yes. A higher income tax rate might mean that company raises prices to get back to that set amount of after-tax profit. But most companies don't operate that way. If higher prices would, in their assessments, mean greater profits at no cost to, e.g., their images or ability to grow over the long term, then they'd have those higher prices anyway.
Now... higher business income taxes can mean a lowered (expected) effective return on capital and thus can affect how attracted to business ventures (in general or in particular) capital is. Higher income taxes can, e.g., affect whether certain business activity is engaged in or whether certain businesses are able to raise the capital they need in order to succeed. Similarly, higher income taxes on labor can (at least in some cases) affect whether there's enough (expected) effective return on labor which one might engage in, or on incremental amounts of labor one might engage in, to justify one's decision to engage in it. But those are different considerations.