pweeg3
1 Jan 2016 / #601
Shouldn't the law contain provisions that the taxed enterprises must accordingly reduce their profit margin and not pass the tax onto clients or risk puninitive measures if they do?
Thats, fundamentally, anti-capitalist. If they wanted to reduce profit margin, they would introduce a law to do that, but they haven't.
Companies work on the principle of taking the costs and adding a %-age for profit. So,,
a) Increase the cost with taxes means the cost of service will go up.
b) If you can't make a profit, take your investment(money) away and use it for something else more profitable.
c) Reduced competition means everyone remaining can increase prices to cover the tax and make more profit by increasing prices even more.
Its capitalism, the free movement of capital to where its best and most efficiently used, for the best return.