Murray Rothbard at Mises.org had this reply last week:
mises.org
Murray says that business will have to absorb the tax because they already charge the maximum they can, and so how could they charge more and get consumers to pay -- if there was a way, wouldn't they already do it? There are big implications if the consumers vanish.
However, Murray misses the point I think that people price shop. A consumer will pay that $1000 now because the guy down the street charges $1025. However, if the 14% tax is applied, then they guy down the street is *still* $25 higher, and so the scam, I mean system, works if everybody raises prices. Of course, some will absorb the price but ultimately they will either be force to pass it on or go out of business. Passing it on, however, could sink sales regardless of competition and so lead to business failures anyway.
Like Murray says, all the attention is on HOW they get our money, the so-called "fairness" of taxation, but little attention is paid to the quantity they take. |
