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A Value added Tax, as is done in some countries solves your last issue.  When you buy something for a $100 and add value to it and then sell it for $200, you collect the full tax from the buyer, but you can deduct the tax you paid on the $100 of matrials you bought.  So, in the end you only pay the tax on the value you add.


One problem with that is that you pay the tax on what you buy.  If you end up never being able to sell it, you never get your money back.  Also, you are forever out of pocket on the tax you paid on your inventory,


In the end, our system is the unfairest there is, excepting all of the other systems.


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