W
WizardofSoda
Overlord
★★★★★
- Joined
- Aug 25, 2019
- Posts
- 8,051
Say one country has a normal corporate tax rate of 20%. And you sell $10 billion in product and expenses $7.5 billion to make $2.5 billion in profits during a boom in prices. So the net profit is $2.0 billion after taxes.
Now the country raises the corporate tax rate with windfall taxes to 50%. The corporation then raises the prices by 15% so its revenues are $11.5 billion. And then since expenses are still $7.5 billion, that is $4.0 billion in profits before taxes, minus the 50% to taxes, is $2.0 billion in profits after taxes.
Then since the prices for energy rose by 15% over night, the government subsidizes this for people which costs $1.5 billion. Which is the increased amount of taxes they got from the windfall taxes. The government also uses this opportunity to give the subsidies mainly to groups who are most loyal politically to the government like minorities and single moms, and not to the hated normies who demanded the tax.
Luckily no normies are ever smart enough to figure this out. It is multiple levels of abstraction too complex for them. But they are darned happy and cheering so hard to see those rich bastards paying the windfall taxes. Which the rulers have gotten smart enough to let the people celebrate, and even the smart rulers they act all sad and beg for the windfall tax to be lifted.. to which the normies all shout.. Never! and roar with triumphal laughter.
Now the country raises the corporate tax rate with windfall taxes to 50%. The corporation then raises the prices by 15% so its revenues are $11.5 billion. And then since expenses are still $7.5 billion, that is $4.0 billion in profits before taxes, minus the 50% to taxes, is $2.0 billion in profits after taxes.
Then since the prices for energy rose by 15% over night, the government subsidizes this for people which costs $1.5 billion. Which is the increased amount of taxes they got from the windfall taxes. The government also uses this opportunity to give the subsidies mainly to groups who are most loyal politically to the government like minorities and single moms, and not to the hated normies who demanded the tax.
Luckily no normies are ever smart enough to figure this out. It is multiple levels of abstraction too complex for them. But they are darned happy and cheering so hard to see those rich bastards paying the windfall taxes. Which the rulers have gotten smart enough to let the people celebrate, and even the smart rulers they act all sad and beg for the windfall tax to be lifted.. to which the normies all shout.. Never! and roar with triumphal laughter.
Last edited: