Quote:
Originally Posted by piece-itpete
Of course 
If it costs me $1.00 to make something, and I need to make 20% to justify being in business, I charge $1.25.
If the government changes me 20% on it, I need to charge $1.50. I sure as heck don't pay it, the customer (who already pays income and sales tax!) does.
Pete |
Government only taxes the clear profit, not the total revenue. Accordingly, there would be only $.05 of tax per unit in your example ((1.25-1.00)x0.20)