> That is why the original assertion is scary. The assertion was made > that profits not collected via taxation were a subsidy. A subsidy is > when you give something that is yours by right to another party to > encourage action by that party. For profits not claimed via > taxation to be a subsidy, the profits must be assumed to belong not > to the corporation, but to the taxing authority - they state.
You're easily scared. It's a little confusing, but not so scary. Do you do your own business taxes?
Profits are just that--revenue that remains after costs/expenses. Taxes are fees treated as expenses that are incurred to cover the cost of all the services that are provided by society so that the corporations/companies can do their business without undue distractions, competition expenses, or costs for infrastructure and public support services.
Most corporations are regulated in one way or another, mostly to keep them from abusing the public, as they have done for hundreds of years [that's why they have renewable charters or licenses from states]. By giving a monopoly to a broadband provider, in effect they get a subsidy which is no different from the subsidies that we still give to the oil companies, just not usually much. OK don't call it a subsidy, call it a tax break, or a gift, or legally locking out potential competitors if there are any, so that the provider can make a bigger profit as an incentive to develop their network. That results in higher profits, or lower expenses than would exist without the legal monopoly--hence a SCARY!!!! subsidy. The rest is profits.
I wonder how prices will change if we eliminate corporate taxes and replace them with a VAT [value-added tax], no exceptions. At first glance VAT looks like it would add a lot to prices for goods. Countries with VAT have higher prices, don't they? Not necessarily. I like shopping in Spain and France where many goods are cheaper than here, even with the currency fluctuation and VAT. It could work in the US, but will the prices remain pretty much the same? It appears that they could, if implemented carefully.
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