We received this submission today from a friend of the blog: Roland Tomassi.
As a business owner, I appreciate the current tax system, and would even be in favor of the government doing more things for the community and for businesses. I understand that an expansion of the government would mean an increase in taxes, but again, I am alright with that. I realize that this seems like a strange stance from a business standpoint, since all anyone ever seems to talk about is how, if we have lower taxes, then business would be better off. I would like to take this time to disagree with that standpoint.
To start with, we run many trucks up and down the roads, and one of the things that we avoid while driving are toll roads. We often use anything other than a toll road in planning our routes for pick-up and delivery. The roads we use are all paid for from taxes, including the taxes that the company pays for. If then, we lower taxes, either those roads will fall in to disrepair, causing more frequent truck repairs, or they will turn to toll roads themselves. So what’s wrong with toll roads I’m asked. A company who runs a road can do it at a cheaper rate than the government, and it would be in good repair. Though that is possibly true, my problem with it is this: Every time a truck goes over that road I have to make a payment. When I use that same road, paid for with taxes, I only have to pay at the end of the year, and only if we make a profit. As most people know, the last few years have been pretty tough for almost everyone. For the previous few years we have not had a profit, in fact have had losses. Now then, if those roads were toll roads, we would have lost even more money, because we still would have had to pay to drive on them, but because they are tax based, we paid nothing. No profit, no taxes. As I hope you can see, if we reduce taxes, and privatize many of the services we currently use, then even in bad years, we will have to pay for those services, and that would put us further into unprofitability.
Roads are obviously not the only place where this would occur. You can see fire and police services as well. If you looked at all the services that we receive from our paid taxes as a company, you can see how having to pay for those piecemeal in bad years would be detrimental to the long term viability to any business.
The other example of taxes being used to our benefit is in the prison and parole system. No I’m not talking about keeping criminals off the streets, though obviously that is helpful for the whole community. I’m talking about a parole program were the parolee’s are paid from the state, or from other organizations, to come and work for us for free for a set length of time. We receive free labor, and are putting a parolee to work. We have a well motivated set of individuals, who want to work and keep from being returned to prison, and we are able to do jobs that we would not normally be able to afford to do, because of the cheap labor force. Now we only get them for 3 to 4 weeks full time for free, at which point we can either get more, or perhaps hire some. As of this time, we have hired many of these people, who have proven themselves capable and willing to do the jobs that we ask from them. In a way, we use this as a temp service, or as a vetted hiring process. Lately these programs are running out of funding, and therefore we are not able to get these ex-inmates to come and work for us. Again, with our previous non-profit years, these people were free to us in every sense, since we paid little to no taxes.
Recently we have returned to profitability, and will now be paying back to the state and federal government for all the past services that we used at no cost to us. Since we are profitable again, we can afford to pay for those services, but without the current tax system in place, we may have not been able to return to it as quickly as we have. We also receive tax credits for doing certain things as a business, which would surely disappear if it was decided to lower taxes. In that regard, I worry that lowering the tax rate would actually raise our taxes, but that is for another day.