Apparently America still doesn't get it

Why is transportation not a legitimate business expense? How about electricity for your office lights? What about the cost of a roof to keep rain out of your factory?

To what goose and gander do you refer in this situation?

Tom

 

The goose is oil subsidy in general, the gander is my deductions for oil use. E.g., I am paid 51 cents a mile when I use my car in business. That amount fluctuates with cost of petrol.

While you and I might use a Prius for our business transport, a huge segment of the business community picks a fuel guzzler instead, because of the subsidy.

This is the general problem with subsidy, it encourages consumption and inefficient utilization. And of course not discussed but not forgotten, subsidy entails a bureaucracy to administer, and is always ripe for exploitation and gaming. What troughs exactly do you think the lobbyists are feeding at, if not subsidies ?

Business expenses should be passed on in price. If I am not willing to pay the expenses directly, why would I want to pay them through corrupt, inefficient taxation ?

 

If you used a Prius for business, could you end up with more money left after tax deductions than, say, an SUV?

 

Everything will be hunky-dory once the re-education camps are up and running.

 

You could, and you might think that the possibility would lead to efficient utilization. Clearly though that is not happening as a rule in practice. Part of the reason is mixed use vehicles, but I think the more important reason is that subsidy is buffering business people from the results of their actions.

As an example, consider a business that deducts 51 cents for every mile traveled, and has a tax bracket of 33%, implying that 17 cents is paid to the business from the government every mile traveled. They currently drive 1000 miles a week, although smart conservation would allow them to halve that amount. A 20 mpg guzzler fuel costs is covered by subsidy just about entirely ($3.40 a gallon.) They could save on wear and tear by conservation, but depreciation schedules encourage new purchases every 5 years, so the wear and tear matter little. Result: no profit motive to conserve, and perversely, they just might charge *more* because they can conspicuously demonstrate a high cost of business.

 

Fair point, but to be consistent you would also need to eliminate business taxes. Otherwise a business would end up paying income tax on gross expenses, not just on profit. Eliminating all deductions, personal and business, would also work.

Tom

 

My father had an F150. I used it to help a friend move to the west side of town (which it's useful for, of course). As I recall, two trips there and back used 1.5 tanks of gas (with it having more than one tank). Of course, it had furniture in it. In my Civic, that drive would have used about 0.25 of a tank (if full), although I guess it wouldn't have taken as much stuff. A Prius would take even less. And back then, gas wasn't as expensive. I still fondly remember driving over to Kemah to the gas station used in filming that movie they did around here...anyway, you could get it for 87 cents. I think I even saw 84 once somewhere. Those days are gone.

For me, fuel efficiency isn't really about cost per se, though.

1) I hate standing there pumping gas (the pump handles are really awful when you have small, delicate hands, and many don't have hands-free clips), and
2) I like to be able to snigger at other people. I admit it. I put some gas in my Civic and drive off thinking, "HA HA!" like Nelson from the Simpsons as I exit past SUV drivers who are still standing there, pumping. And I know I can go across town or anywhere without having to be forever looking for the nearest station.

I like small cars so I can snigger, too. I fit in anywhere and reverse out with no problem. I once watched a woman trying to park a large vehicle (don't remember if it was an SUV or large sedan now) who took like 2 minutes to do it. I know because I was waiting for her to finish so I could park in my space across from her. She clearly wasn't familiar with parking it, though, I admit. But I have a truck across from me that sticks out of its space, impeding my turn. And I can park in spaces where the driver across from me has pulled too far forward without having my back end sticking out.

 

That is too damn funny a truck driver with a drill now. Then they can replace their F150 with an F550 because gas will be cheaper?

 

Absolutely, get rid of every subsidy.

But to your point about paying income tax on gross expenses, I have to admit I missed that wrinkle. At the moment I cannot see how we continue to tax profit and not expenses without landing back in the current situation. Perhaps the answer is generally lower tax brackets above and beyond the tax avoidance from subsidy erasure ?

Thanks, you gave me something to think about.

 

I worked for about 5 years as a VIP chauffeur at my last job, and I can tell you one thing about the wealthy-- they know the value of a dollar better than most lower and middle-class people do (at least of those who earned their fortunes themselves). One of my favorite clients was a guy worth hundreds of millions, and one time I asked him why he kept flying commercial instead of getting a private jet. He said when he'd made his first hundred million, he'd thought about it. But then he realized he'd be spending several million on an aircraft, a couple hundred thousand a year on a crew that basically did nothing most of the time, a ton more on maintenance and hangar fees and so forth, and that he already had a dozen friends who own their own jets that mostly sat in their hangars at home and that he could just borrow one of theirs if he ever needed to use one and save himself all that expense. He realized that he'd only be playing "keep up with the Joneses" and that if he didn't play along, he'd have more money and they'd have to work harder to keep up with him.

He would also always remind his kids whenever he was bringing them somewhere with him in one of our cars to "always take care of the people you ask to take care of you" as he'd peel off an extra $100 for driving him. Man, I loved that guy! He was a true genius.

 

I worked for someone similar in the past. Also, one way you can really tell the people who have made it - they're nice to a taxi driver!

If they demand this or demand that, treat you with contempt then they're probably just an arrogant middle manager. I've found the really wealthy or successful will be a joy to deal with, they'll want to sit in the front with me, shake my hand and introduce themselves and generally be just down right nice. I guess it's because they've nothing to 'prove'.

You get much less hassle from the CEO of a company than his junior manager!

 

black new Ice Capade in long drive thru line

More confirmation as usual that America doesn't get it...

I was at a very busy In-N-Out Burger the other day and I counted at least 10 cars in line at the drive thru. I saw a brand new black Cadillac Escapade (aka gussied up monstrosity battering ram of death) w/o plates yet come out of the drive thru line. Of course, it was being driven solo.

 

His SUV runs on subsidized gasoline paid for by you and me. If he has a business, it is just an expense!

New survey finds the majority of likely US voters do not want an increase in gasoline tax — Autoblog Green

 

As China and India get richer the price of oil is only going to go one way. Either prepare now by slowly encouraging smaller and/or more efficient cars or let your economy hit the skids when nobody can afford to fill up.

Thankfully most members on this forum 'get it'.

 

And Some of the Oil Money FUNDS IRAN and Other Terror Groups. I Love the SUV's with the I Support The Troops Sign On The Back.
I want to ask "How By Supporting Terror"

 

People can not make the connection to how much money is being transferred one-way, every day for oil and what kind of activities are being financed by that money. I just read this morning!

Survey: Consumers prefer gasoline vehicles, EVs come in dead last — Autoblog Green

 

I don't know if a lot of the fuel we get is helping iran, I think most of our "foreign" oil is Mexico / Canada...

What is even more revealing, is the fact that the #1 vehicle sold in the US is Ford F series. #2 vehicle is Chevy Silverado. And they discount vehicles like crazy to maintain the sales volume...

And .... GM made 160K vehicles considered trucks last month, while producing 60K cars... No Volts...

 

America is getting it don't you all feel it in your back side everyday. When will Chevrolet, Buick,Ford, Lincoln, Mercury and Chrysler get it. After they get it maybe america will follow. Oldsmobile, Pontiac, AMC and Saturn sure got it. What is certain more brands will fall and not just the auto industry, right Montgomery Wards, Marshal Fields, Woolworths, National Foods, Builders Square, Circuit City, Browns Chicken, etc. in my area.