Timmy elsewhere

At the ASI.

Why do some nutters insist that the value a company offers is defined by its tax payments?

9 thoughts on “Timmy elsewhere”

  1. Because we exist for each other’s sake. So they would say. And taken to its conclusion, this doctrine means that the productive are there to be milked. Or bilked.

  2. Because they don’t believe factory gate output is value; they measure value in terms of the labour input and the degree to which the company creates “real value”, which is produced by the State, via taxation.

    Effectively, they see the production of goods (how we evil capitalists measure value) as destructive of value; expending labour on mere fripperies. In that sense, they’re virtually physiocratic. So, the State’s job is to create some value by reclaiming moneys from the producers of, and consumers of, those fripperies.

  3. Well I would be very happy if companies avoided taxes and reduced their prices. Not sure if that ever happens in reality though.

  4. ” Not sure if that ever happens in reality though.”

    The one person in the entire UK economy who’s never been asked “You wanna give me cash, I’ll knock the VAT off”
    Wow!

  5. Never had the VAT knocked off, have had 10% discount for cash. Whether the tradesman then didn’t put it through the books I wouldn’t know.

  6. For firms that are subject to taxation, what is true is that the payment of taxes indicates that the firm is engaging in activities that are more value creating than if it were in a perfectly competitive market. Under perfect competition, firms produce no economic profit, they just cover their costs (including opportunity cost). Such firms will see employees paying taxes, but there will be no surplus at the corporate level that results in the payment of tax.

    This is undesirable not because of the tax thing but because no surplus is being created. I’ve always wondered if this was the problem in Japan, where te latest figures show only 26.5% of firms are profitable for tax purposes:

    http://www.nta.go.jp/kohyo/tokei/kokuzeicho/hojin2011/pdf/h23_houjin.pdf

    Table 3.

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