No, prices would not go down. In the real world, prices would remain the same, with a someone pocketing the profit and then only paying a 9 percent tax on it. So companies could then see a nearly 25 percent profit by keeping the prices the same.
If I by a necklace for 50 cents and the market rate is five dollars. I make 4.50 on the necklace. Priced in that profit though, are the daily costs of doing a fair. The fuel, the food I have to spend—MY mortgage, insurance, etc.
My supplier is NOT going to sell me a necklace that comes from the Philippines at 35% less, cause prices ain’t dropping over there— and no way am I going to sell it for 35% less. It ain’t going to happen.
Many of us out there are not 9-5 clock punchers. Never could do that. So far I see this plan just absolutely killing me.
Until one competitor decided to undercut your prices and see just a 24% profit. Then one of his competitors undercuts him and keeps just a 23% profit. And then....
Until an enterprising young start up decides they can live with a 10% profit selling the same product. Aren't you forgetting about competition? Margins are margins, some companies are better at squeezing out more profit with less overhead than others. There is a big difference between the first two 9's and the last 9. The first two are taxes on production whereas the last 9 is a tax on consumption. Market dynamics play a significant role in prices.
agreed on your last point
No, prices would not go down. In the real world, prices would remain the same, with a someone pocketing the profit and then only paying a 9 percent tax on it. So companies could then see a nearly 25 percent profit by keeping the prices the same.
I’m going to eat you for lunch, take your customers and best employees. My profits will be higher than ever, and you’ll either go out of business, or copy my approach.