John Pitera's Market Laboratory Message Board

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Strategies & Market Trends : John Pitera's Market Laboratory

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To: John Pitera who wrote (5627)	2/18/2002 8:49:30 AM
From: Jorj X Mckie	Read Replies (3) of 33421

An argument for why the stock options controversy may eventually be swept under the rug. I have always been a believer in not taxing businesses. Many conservatives/libertarians think along the same lines. But now with the everyone seeing an "enron" in every balance sheet, the tax benefits from the exercising of stock options is being viewed with the ugly eye. So what happens if we take this little tax benefit away from the Cisco's of the world? Same thing as if Cisco has its taxes raised. Simple, they will raise their prices commensurate to their margin targets. The taxes will be passed along to the consumer no matter what. This would pretty much act as a damper on an already hurting economy. And I think that it is simple enough to explain that even our most dense congresscritters will understand the ramifications of making too much of an issue. While there have been many implications that businesses who have benefitted from the stock options tax benefit are somehow ripping off the system, I see this as more of a "return to zero" from the revenues that are stolen by the gov't in the form of taxes. Sorry, my inner libertarian sneaked out again.

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