Re:Tell HN: Help restore the tax deduction for software dev ...
by gottorf on Tuesday June 10, 2025 @05:28PM
(#44241649)
> If you tax profit, a 100% tax rate leads to shifting profits to reinvestment and salaries and benefits.
There wouldn't be any money to reinvest into salaries and benefits, because capital would not be deployed on a risky, potentially money-losing venture without the possibility of profit.
If you tax inputs but not outputs, then a 100% tax rate increases the cost of goods and services but does not necessarily kill the business.
If you tax income, then a 100% tax rate kills all income. However, income taxes are usually progressively, so a 100% marginal tax rate places a cap on income, but income below that can exist.
If you tax profit, a 100% tax rate leads to shifting profits to reinvestment and salaries and benefits.