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Comment by nextparadigms | Hacker News Reader

Then Dell should find a way to be profitable in that business, or create new businesses that are more profitable. I think if the revenue tax was implemented in all countries, it would also solve the problem of companies shifting profits from one division to another to avoid paying much in certain countries. If you had 1 billion dollar revenues from a country's citizens, then you pay say 2% of that in taxes.

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Taxing on gross is bad when your value add is simply integration. In the case of building computers - you take a bunch of components from individual producers, slap them together & call it a new product. The actual work done is very little & the margins are small but the total cost of the finished product has to reflect the cost of the components. Putting $10 of labor and $5 of infrastructure to make $5 of profit on top of a $1000 device become unfeasible.

Reading the article, they claim an operation like this is an ideal remedy to being "too big" yet their proposed tax plan makes it untenable.

If that kind of tax was implemented in all countries, this would render almost all phone manufacturers (except, well, you know, Apple) unprofitable. In fact it would not: they'll just raise prices, and we, as customers, will effectively pay this tax, not businesses.

But ultimately, at the end of the road, are not all taxes levied against businesses effectively paid by their consumers in the ultimate price of the product/service provided by the business?

The business does not make money appear from thin air. Any money that goes from the business to the tax authority has to have originally arrived in the business from a customer buying the product or service offered.

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