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July 14, 2009

Republican Myth: Businesses Leave California Because Of Taxes

-- by Dave Johnson

This post originally appeared at Speak Out California

Republicans like to claim that businesses leave California because of having to pay taxes.

I used to own and run a business, and I have some news for Republicans: Businesses only pay taxes on profits. You don't pay taxes unless you are making a profit. Paying taxes means you are making a profit. Making a profit is a good thing, and California businesses pay a small percentage of the profits to the state to help cover the expenses that enabled you to make that profit.

I'm not sure how many different ways I can say it. You pay taxes after you make a profit. At the end of the year you add up your revenue and you subtract your expenses and other deductions and then you know what your profit is.

Oh, one more thing for the slower-thinking Republicans out there: profits are a good thing, not a bad thing. And when you are making a profit the last thing you do is pack up your business and leave behind the circumstances that enabled making that profit.

I understand that Republicans hate government and are enraged by the idea of actually giving something back to the community to help pay for the roads, bridges, courts, police and fire protection, educated citizenry and the other parts of the state's infrastructure that created the environment that led to the ability to make a profit. Yes, they hate that. I understand.

But the fact is that businesses do not pack up and leave when they are making profits. So if Republicans want to trick people into supporting tax cuts for the big companies that shelled out so much cash put them in office they really do need to come up with better stories than trying to claim that businesses pack up and leave the state because they are making too much profit.

Click through to Speak Out California

Posted by Dave Johnson at July 14, 2009 1:47 PM


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