Part of the frustration I have with the political season is the misrepresentation of “who pays taxes”? Believe me, it is not the “big guy”, it is always the little guy!
Let us start with the statement – Businesses do not pay taxes; the consumer pays them!
Example 1. Property Taxes – when we vote to increase our taxes, the property owner pays them – but if the property owner is an apartment owner – he passes them thru to the renter in the form of rent increases. If a commercial property owner – they are passed off as part what is referred as “triple net” – property taxes, maintenance, and insurance costs to the renter.
Example 2. Advisory votes on this year’s ballots – #33 is a tax on heavy equipment rentals – this will be paid by the consumer – not the equipment operator. #34 is an increase in the Business and Operations Tax (B&O) on services – this is a tax on gross revenues – before payroll, property payments, utilities, etc. – but the service provider passes it on to the consumer in higher fees. #35 – a $1Billion increase in taxes paid by Boeing – this will be passed on to the purchaser of planes and will be included in the price of tickets bought by flyers. Not to mention the impact on Boeing and will they reduce operations in Washington – costing us jobs, sales tax revenues, etc. (last week it was announced they are looking at selling their Seattle Area headquarters in Renton).
Example 3. Increase in the Federal Corporate Income tax rate from 21% to 28% – the consumer pays these taxes, not the businesses. When you buy a product, taxes are included in the cost of goods. So, the seller increases their price of goods and services to cover the cost of taxes which also may make their product pricing not competitive in a Global Economy. Again, the consumer pays them.
And when we get into discussions about “tax loopholes” – these are a consumer subsidy.
And while I am at it – let us talk about the “fracking” debate. Fracking has allowed the United States to become energy independent. What does this mean – we have been a net exporter of petroleum products from the US for the last eight months. This means, we are shipping more petroleum and gas products out of the US than we are importing-we are no longer being held hostage by “Middle East” oil producers. While the military/Industrial complex does not like it, we no longer need to fight overseas wars to protect our energy supply and our economy. Definitely a win-win!
And the result is gasoline for our cars is under $2 per gallon in many states and even as low as $2.25 per gallon (Thursday at Costco) in this state. That means more dollars in our pockets to buy the other things we need for our families – groceries, clothes, take a vacation, etc.
And it means the cost of Natural Gas for cooking, heating, drying our clothes, etc. is lower – giving us more money to buy the necessities for our families – not having to make a choice.
So, this election season, I am trying to provide you with information that can help you make educated choices – I have made mine. You make yours! Remember – businesses do not pay taxes – the consumer does!
~ Dick Donahue, President of Common Threads Northwest and Owner of Asset Advisors, LLC