Study to Determine the Effects of Alternative Taxes on Small Businesses

摘要

Taxes impact business, large and small, in a variety of ways. Issues relating to return on investment, working capital positions, failure rates, expansion, and risk taking turn in part on the effects of taxation. On intuitive grounds, it would be suspected that alternative tax instruments would have a differential impact on small versus large businesses. This is so because those factors determining various tax bases appear to differ significantly by size of firm. Heretofore, however, these effects had yet to be adequately documented. The purpose of the report has been to study the differential impact of various tax sources by industry and by firm size. This study, which is national in scope, uses business tax return data from 1976. It includes firms that are sole proprietorships, partnerships, and corporations. Further, the study is performed by size of firm, and for industries by sizes of firms in those industries. Finally, we consider tax incidence between producers and consumers.