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That all depends on how you count initial investment. Software for instance (and most intellectual property, which is the basis for much of our economies here i
by HPsquared 4y ago
That all depends on how you count initial investment. Software for instance (and most intellectual property, which is the basis for much of our economies here in the West) has basically zero marginal cost, it's all up-front development cost. The tax rate would depend on how you amortize the up-front costs, and much accounting trickery/complexity would inevitably result.
- pg_1234 4y agoNope. You are already doing this to determine profit (for the existing tax regimes). All that is required is to take gross revenue (a more basic, simpler value that is already known to determine the current profit calculation), and divide profit/revenue. There may be an incentive to amortize more evenly, but that is typically what you should be doing (amortizing is meant to spread a one-off cost over the period of the resultant benefit) ... currently the incentive is to book costs early to postpone apparent profit and the resulting tax, which is usually both trickier and less moral/honest.
- deleted 4y ago[deleted]