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Sure, if you want literally everything to be vertically integrated. Either your tax is meaninglessly small, or everything that exists today in a supply chain (e
by murderfs 5y ago
Sure, if you want literally everything to be vertically integrated. Either your tax is meaninglessly small, or everything that exists today in a supply chain (e.g. iron ore -> iron pellets -> steel billets -> steel wire -> nails) would have to get conglomerated into a single entity to compete against other companies doing the same.
- voz_ 5y agoJust trust bust for that.
- isbvhodnvemrwvn 5y agoYou don't understand the problem. If you have 4% tax and it takes 10 steps to manufacture the product, you will be paying 48% effective tax. If it takes 2 steps, you are paying 8% effective tax. That's why VAT is a thing, and one of the numerous reasons why a flat tax on everything is a bad idea.
- jsnell 5y agoThe Value Added Tax (which is the way sales taxes are structured in most of Europe) only taxes the sale to the final (non-business) consumer. The length of the supply chain doesn't matter, the aggregate tax burden will only depend on the price of the final product.
- murderfs 5y agoYes, but that's not what the original poster proposed! "Just do a flat x% tax on every dollar of revenue. That's it. Forget income, loss, expenses, tariffs, etc etc." The way that VAT is implemented is that every intermediate pays VAT, but gets a credit for the VAT that they paid.