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submitted 8 months ago by John_McMurray@lemmy.ca to c/canada@lemmy.ca

What a mystery this is.

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[-] Nouveau_Burnswick@lemmy.world 9 points 7 months ago* (last edited 7 months ago)

they tax the living shit out of businesses, much more and it'll start to cause failures.

Why?

Taxes are on revenues, not gross profits. That's why EBIT exists as a performance measure.

As a quick example of a made up corp:

Gross profits 1.1B

COGS + OpExp 1.0B

EBIT 100M

Taxes 10% (30%)

Revenues 90M (70M)

Now mom and pop barely alive

Gross profits 500k

COGS + OpExp 500k

EBIT 0

Taxes 10% (30%)

Revenues 0 (0)

this post was submitted on 30 Mar 2024
33 points (77.0% liked)

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