Pay at the Pump With Cash

[coobie]

A small business will almost always give you a cash discount. It cost them 3% credit card fees. Sometimes they might not charge you sales tax. They're more likely to negotiate if you're paying with cash. I've seen some gas stations advertising a lower cash price.

++1,you are correct.

 

[MossRoad]

Legally, I don't think they are allowed to not charge you sales tax. They might pay it for you, or discount the price of the item the amount that the sales tax is, or just make it up out of pocket, but they probably can't not charge you sales tax. They'd be in accounting **** pretty quick.

I can't see why they'd knock off 5% sales tax to cover 3% credit card fees. The only reason I see people taking cash over credit once the 3% fee is accounted for, is dishonest cash-only, keeping two sets of books, not paying your business taxes kind of stuff.

 

[4570Man]

Of course it's not legal, but do you really think a small business pays every dime of tax they were supposed to? Sales tax is actually nearly 10% here. How is cash keeping dishonest?

 

[Copperhead]

I get a solid deal from a local farmer's cooperative near me. They give me a fuel card for their Cenex stations in the state, costs me nothing, and I get 5 cents off a gallon at any of their locations. Just has to be paid in full once a month along with propane bill. I have them for my propane supplier, and they throw the card in for free.

 

[Copperhead]

Of course it's not legal, but do you really think a small business pays every dime of tax they were supposed to? Sales tax is actually nearly 10% here. How is cash keeping dishonest?

I'll let you in on a news flash. No business pays any tax. The customer is the one who pays the tax, the business is just the conduit for the government to get the tax from the people. Taxes that my business has to pay is factored into the pricing of my service. I don't do retail sales tax kind of thing, but I have considerable regulatory fees and taxes on top of income taxes. The customer gets to pay them for me just like any other business.

 

[4570Man]

Technically the business does pay taxes. Just not sales tax. All products have a MSRP ( manufacturer suggested retail price ) which is usually higher than than the actual selling price. If you didn't have to pay taxes, the product would still sell for the same amount and you'd make more money. Since you end up making money not loosing it ( hopefully ) the customer paid for all the expenses. But that's kinda like saying the person who's yard I mowed paid for my dinner. Now the problem, it hasn't rained in weeks.

 

[Thall303]

I'll let you in on a news flash. No business pays any tax. The customer is the one who pays the tax, the business is just the conduit for the government to get the tax from the people. Taxes that my business has to pay is factored into the pricing of my service. I don't do retail sales tax kind of thing, but I have considerable regulatory fees and taxes on top of income taxes. The customer gets to pay them for me just like any other business.

Any business that makes and reports a net profit on sales and service will definitely pay taxes on that profit.

 

[aczlan]

Any business that makes and reports a net profit on sales and service will definitely pay taxes on that profit.

And any business worth its salt will try hard to make sure to have as little profit as possible.

Aaron Z

 

[smstonypoint]

I'll let you in on a news flash. No business pays any tax. The customer is the one who pays the tax, the business is just the conduit for the government to get the tax from the people.

Technically the business does pay taxes. Just not sales tax. All products have a MSRP ( manufacturer suggested retail price ) which is usually higher than than the actual selling price. If you didn't have to pay taxes, the product would still sell for the same amount and you'd make more money.

Pardon the interruption, but this may be a teachable moment. (Old habits die hard.)

The economic incidence of a tax on a product or service does not equate to the statutory incidence, but rather depends on how responsive consumers and producers are to price changes (i.e., relative demand and supply elasticities).

Suppose there was a $1/gallon increase in the federal tax on gasoline. The demand for gasoline is relatively inelastic compared to the supply of gasoline. so Panel 1 below is relevant. Virtually all of that tax increase will be borne by consumers.

Congress discovered that the demand for luxury yachts is elastic relative to the supply of those yachts (Panel 2) when they passed a luxury tax on yachts in 1990.

"Within eight months after the change in the law took effect, Viking Yachts, the largest U.S. yacht manufacturer, laid off 1,140 of its 1,400 employees and closed one of its two manufacturing plants. Before it was all over, Viking Yachts was down to 68 employees. In the first year, one-third of U.S. yacht-building companies stopped production, and according to a report by the congressional Joint Economic Committee, the industry lost 7,600 jobs. When it was over, 25,000 workers had lost their jobs building yachts, and 75,000 more jobs were lost in companies that supplied yacht parts and material. Ocean Yachts trimmed its workforce from 350 to 50. Egg Harbor Yachts went from 200 employees to five and later filed for bankruptcy. The U.S., which had been a net exporter of yachts, became a net importer as U.S. companies closed. Jobs shifted to companies in Europe and the Bahamas. The U.S. Treasury collected zero revenue from the sales driven overseas."

The tax legislation was repealed in 1993.

Source: Ignorance, Stupidity or Connivance? - Walter E. Williams

Steve

 

[smstonypoint]

Any business that makes and reports a net profit on sales and service will definitely pay taxes on that profit.

It takes some sophisticated modeling, but it turns out that the incidence of taxes on corporate profits falls upon the owners (shareholders) and corporate employees. Depending upon the economic models, assumptions, data, etc., some studies find that most of the burden falls on the owners, while others find that workers bear most of the burden.

Ultimately, consumers suffer as a result of less investment, innovation, etc.

And any business worth its salt will try hard to make sure to have as little profit as possible.

Huh? That means that they would try to maximize their losses.

Steve