FairTax 4: Losses

Tbe original poster wrote:

“As a side-issue vaguely related to this, does anyone else detect a surge in the entrepreneurial spirit with people coming up with new ideas, putting them up on kickstarter, getting prototypes made through 3D printing or other means of manufactury, and not having to go through major corporations?”

No.

Yes, there are a few highly visible examples of this, but the overall trend in the last few years has been extremely bad for small businesses and startups. While much hay is made from the fact that there are more than 20 million corporations in the US, most of these are dormant or defunct. Fewer than 6 million actually have at least one employee.

Moreover, the ratio of new companies started versus old ones failing has been positive since these numbers began to be tracked many decades ago. Now, it is negative, with a loss of about 70,000 businesses per year more than new ones being started. This number is more than 1% of all active businesses, per year, and it is accelerating.

Not good. Litigation and compliance (including with the taxes under discussion here) seem to be the largest two factors. I have owned a number of corporations and had thousands of employees, and that experience was positive and generated tens of millions of dollars in tax revenue. But with California and the US heading in the direction they are, I am disinclined to pursue things that way again. There are many like me.

As the old expression goes, “I have so many attorneys as friends that I can no longer afford to have enemies.”

==============/ Keith DeHavelle

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