Quote:
Originally Posted by John Mercier
The business taxes and the I&D are both income taxes.
BPT was instituted long ago to tax profits rather than the old system that would add equipment and even livestock to the property tax. But this money would flow to the State, as no really local services were being provided by it. Now some of it is return as education adequacy grants... which is why we even formulated the EFA to use the same sourcing. A well-educated workforce being to the benefit of business productivity. The BET was enacted due to businesses using excessive accounting gimmicks to overcome the BPT. A business pays the greater of the two... and thus it is not really worth the effort to arrange business processes to avoid a profit. Many of those tax avoidance processes using up product time and assets that should go towards growing top line revenue and seeking efficiencies to deliver it to bottom line results.
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I disagree a little bit. The BET was not because of "gimmicks" really. It was because owners took all their profits in income so professionals like attorneys and accountants who usually took all their profits in income would also have to pay a tax. A business/owner doesn't really pay the greater of the two, they pay BPT PLUS BET on the income they take. So they pay both.