The Cyclic Nature of Business

While the politicians are considering taxing businesses, I hope they don't forget the cyclic nature of all businesses. Real estate is a good example. In a boom part of a business cycle, real estate agents and companies make (sometimes) a lot of money. Business then flat lines for 2-3 years and little or no income is earned. Then, in a slower market or "bust", businesses must plow money back in to keep the doors open, size down, reduce overhead, then reinvest to prepare for the next boom cycle. So over a 10-year period after profit, reinvestment and growth, the overall profit is probably minimal. With added business taxes, especially in a boom cycle where companies earn the most, that may be enough drain to stop a lot of businesses from surviving the next down-cycle. Without profit, what is the point of business?

Again, when politicians talk about taxing business, I hope they don't forget the cyclic nature of business.

Emmett Brennan
Sugar Pine Realty
Owner-Broker-Founder