Tax Myth #1


1.  We have a choice; we can tax people or business.

How would we go about taxing a business?  Do armed IRS agents bust into Nike factories and demand Federal Reserve Notes on the spot from the machines that melt rubber?  Of course not.  Taxes paid by Nike come from business operations; if the business is profitable, the corporation Nike pays the IRS corporate taxes.  If we discovered tomorrow that melted rubber has been the chief cause in man-made climate change, or global warming or whatever we are calling it now, and taxing the snot out of rubber production was the only solution to save the planet, the machine still could not foot the bill.  All taxes are paid by people.  Nike’s share holders, made up entirely of humans, or owners must pay the corporate tax with fewer retained earnings to expand the company.  The rubber tax will increase the cost of shoe production, which the customer will ultimately have to pay for through higher shoe prices.

The obvious convenience about the myth that we can tax inanimate objects is that we can raise revenue without anyone having to pay; a swoosh symbol will pick up the tab.  In actuality someone has to pay this tax and it may even be the guy sitting at Panera typing away on his Macbook wearing his Nike shoes and Converse socks writing an article about how we should tax big business.

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