Oh I've seen this claim over and over (notably most often from right-wing sources). It might make the world simpler IF it were true, but obviously it's not entirely true. Yes, businesses can TRY to pass on taxes to their customers through higher prices but you are completely and utterly FORGETTING something. It's called COMPETITION and DEMAND. While a company can try to pass on its taxes, if they raise the price above what consumers are willing to pay, they simply get less (or even possibly no) sales. If a competitor is willing to eat a tax (or other price increase due to whatever cost raise for a part, etc.) or lower their profit margin, they will likely get the sales and the business who raises their prices will not.
Demand drives price, not supply. This is about as simple as it can get. The price of an iPad 2 was about $325-425 (I found that number on BusinessInsider), and they sold them for $499, $599, and $699, and at the time, they weren't allowing discounts in 2010-2011. Apple sells a computer for 2-3x what a comparable PC would cost, and the demand is there, so they can sell them for what they wish. And they make gobs of money (which you allude to below) doing so.
In other words, it's WAAAAAY too simplistic to suggest that a business can simply pass on 100% of costs to consumers at all times. It just doesn't work that way. If you exceed the cost of demand or competition undercuts you, you simply CANNOT raise your costs without killing your sales. Where this particularly comes into play is with companies making HUGE profits (e.g. Apple). A company like Apple can lower its prices or eat costs all day long because it's making so freaking much money. But it doesn't have to because demand is good. It makes sense, therefore to raise taxes on Apple up the wazoo because at some point raising their prices will simply harm the company and their sales and demand will fall off the chart, particularly so because Apple's products are luxury products and not necessary for life (like food) and yet even food manufacturers do their best to eat costs for certain items knowing the consumer blow back could destroy their business.
Apple cannot "eat its costs all day long" and survive. Looking at the early Jobs-II era, and the horrible shape that Apple was in shows that them eating their costs without demand for their products is a bad recipe for success. Apple has to thank Microsoft for saving it when it was on the cusp of bankruptcy.
As for "raising taxes on Apple up the wazoo" is a bad policy as well. Apple should be taxed at the same rate as everyone else.
Besides, Apple just did what you said about raising their rates to the App store customers, as well as the developers in other markets.
Like most things "right", half of it is half-truths made to make the other side look bad. Corporations are legal entities "people" according to the courts and people pay their taxes.
MIT Economist Jonathan Gruber (hardly a person of the "right")illustrated the concept brilliantly when he said that the 40% Cadillac Tax on health insurance premiums would be paid by the customer of these insurance companies, and that the Federal Government will be the recipient of the revenue, while making the qualifications of the so-called "Cadillac Plans" non-indexed to inflation, so eventually, everyone that gets employer paid insurance into that category.
But even if you ignore what I said above, you still have a TAX SHIFT. In other words, only the people who buy Apple products pay for Apple's taxes. If you were to move taxes off the corporate structure and put them into an income or sales tax, you are moving the tax burden for luxury items onto different markets and income groups instead of the people buying the luxury goods who should be paying them since a sales or income tax are SHARED taxes (i.e. you pay towards Apple's share when you buy a loaf of bread whereas taxing Apple means only people who pay for Apple's good are paying for Apple's tax burden).
That's what I meant by, "their customers do." As for income taxes, I'm vehemently against them, for a number of reasons, but not limited to: It transfers ownership of one's income to the state's permission to keep what you earned. It is, in effect, the government saying, "all your income we have a right to, except what we let you keep by tax rates or a convoluted structure of special interests that get their deductions added to the tax code". The result is a 74,000 page code (in the US) that rewards accountants and keeps people in fear of the IRS. The other reason is that is point #2 of the Communist Manifesto, and the 16th Amendment is an abomination to the US Constitution. (
http://en.wikipedia.org/wiki/The_Communist_Manifesto)
This is also why the "right" wants to move away from income tax and towards sales taxes. The rich pay a far lesser share of their overall income towards just surviving and so a far greater part of their overall income would be available to them if we just had a bigger flat sales tax whereas the lower income people who paid no income tax already now have to pay the sales tax (shifting burden onto people who can ill afford it as they are having trouble just surviving). The middle class may fall somewhere in-between, but clearly the rich would benefit the most by far by such a method.
The problem with simple absolutes used in propaganda on radio/news/etc. is that it only ever tells PART of the story.
See
http://fairtax.org/ While I don't agree with pre-taxing purchases, there is an accommodation for lower income people, with the prebate of ~$500/month, which represents the taxes that would be paid up to the poverty level, which makes it progressive in nature (a ramping progression to the sales tax level, so that level is never received, but approached, like an inverse function (1/x) never reaches zero, but approaches zero, as x approaches infinity.) As you accuse the right of doing, those that oppose replacing (repealing the 16th Amendment, and replacing it with a sales tax - I don't trust politicians, from now to forever, to have the ability to have both a sales and income tax at their disposal) the income tax are using fear, uncertainty, and doubt to use Alinsky's tactics to make people afraid to even question the IRS.
My opposition to pre-taxing purchases is that people tend to blame the wrong people for tax increases, as with gasoline. At $3.92/gallon, a resident of California pays 16.6% in taxes, but since taxes are per gallon, that percentage goes to 33.8% at $1.36/gallon. (Note: the sales tax does slide on this, but there is an state excise tax/gallon as well.) This is not from some infowar site, this is from
http://energyalmanac.ca.gov/gasoline/margins/index.php the state of California web site.
While this is quite a treatise on our perspectives, with some tangents and accusations, I guess we can let it lay at "we agree to disagree".