Read Millionaire Fastlane
- Oct 20, 2012
If you can't operate a business profitably without write offs, then you'll just have to close shop and start another type of venture... The market will correct it self.That's actually not right either...
For every $1B that Walmart makes, about $760M is COGS. (Gross margins for Walmart are right about 24%.)
Of the remaining, $260M in gross profit, about $197M is expenses, and $63M is EBITDA. (Operating margins for Walmart are about 6.3%.)
So, assuming no expense write-offs and a 10% tax on gross profits, Walmart would pay about $26M in taxes, which would be about 41% of EBITDA.
That's a bit higher than the corporate tax rate prior to the 2017 Jobs Act (which was 35%), and about double what it is today, with the Jobs Act in place (now at 21%).
If people REALLY value food, then they'll pay a little bit extra if that's the only way supermarkets can operate profitably.
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