quote: Productivity is how much value a worker adds to the economy in a year.
quote: When you pretend you have more money than you actually have productivity, Greece happens and (if the country has its own currency) its currency falls in value relative to other countries' currency until the country's monetary value matches its productivity. (In Greece's case, it was on the Euro, so the other Euro countries are basically paying the huge credit card bill Greece racked up.)
quote: If you decide 25% of GDP should go to taxes, then 25% of money/productivity will go to the government that year. Doesn't matter whether you extract it as corporate taxes, income taxes, sales taxes, VATs, property taxes.
quote: If your productivity would have earned you $100,000 in salary in a year and there were no corporate taxes, you will only be able to buy $75,000 worth of goods and services. The other $25,000 you would pay to the government as personal/sales taxes.
quote: If you eliminated all taxes except corporate taxes and held prices constant, then the company would have to reduce your salary to $75,000 to maintain its finances. So you'd have $75,000 to spend buying goods and services. The other $25,000 would be paid by your company to the government as corporate taxes.