Lets say that I (as a company) choose to make a product, and after all the research/development, taxation on the property/company, and estimate on man-hours (with cost), I can make the product for X.
Then I work up profits, to figure bonus activity, profit for the stock-holders, the advertising and essentials for a company to exist at this level, and the situation is 40-percent over X.
Then these gentlemen come over, who are not into business or economics, but strictly politicians.
They look at things and decide that you can't do this 40-percent over X, and so therefore.....they intend to tax you (probably in the range of a quarter of the 40-percent over X).
What would likely happen next?
In most cases, you'd (as the CEO/board) would go and move either the headquarters itself....out of the country, or make the radical suggestion of taking the jobs for production, and relocating them to another country with a lesser cost threshold. This means the genius folks who felt you couldn't do the 40-percent over X....loses jobs. New companies to make up for those lost jobs? Well....no. No one would be that stupid.
I'm not saying this would occur on a massive scale, but all you need is one company out of twenty to react, and trigger lesser confidence in producing or selling a product out of that country.....to cause some concern.
So to suggest this type of gimmick in the upstart of a recession? It makes for great headlines, and the general public gets all hyped-up about taking that profit away. Then six months later, they wake up to realize their company is downsizing....to make the product in land far away. The politician can't do much but stand there and admit they chased them out.
Countries that would really benefit out of this scenario? India, China, etc.
The excess profit chatter is something that you need to stand back and admire the landscape upon....because there are always options to make products elsewhere, and cheaper.....lessening regulation 'woes'.
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