BartSimpson BartSimpson:
BeaverFever BeaverFever:
BartSimpson BartSimpson:
So if you leave that bank and they lose the revenue from your deposits then that's an expense for them?
Yes lost business is called a loss.
Then when a company like Wal Mart sees revenues in Canada slide due to the receding economy you're okay with them deducting that corresponding amount from their taxes?
1) What the tax laws allows a person to deduct or not deduct isn't necessarily the appropriate yardstick here since there are other factors at play with tax laws. Accounting standards would be a more appropriate comparison.
2) You confuse a deliberate decision to reduce revenue (tax cut) with revenue that is lost by misfortune due to outside forces (economy). These are not the same thing.
3) A business would NEVER intentionally reduce its revenue for some altruistic, ideological or political reason, so the analogy is poor from the beginning.
But I'll indulge you anyways because you'v overlooked the concept of
Opportunity CostIf a business were to intentionally reduce its revenue for some reason, it's because they expect to receive more money later (for example, by eliminating competition or attracting new customers with a major price reduction). So a business may decide to make less money in 2016 so that they can make 3 times that amount in 2017. The drop in 2016 profits (and the investment that those profits would have earned) is the
Opportunity Cost of the 2017 profits. If a government reduced tax revenue by $1Bn dollars next year, then it has to forego $1Bn from its planned spending. So if a $1Bn shipbuilding program gets cut, the Opportunity Cost of the tax cut is a fleet of new ships (and any net new capabilities the ships would have provided).
CKA Elite 
