"vincent p. norris" wrote in message
...
And aren't your two sentences contradictory? If bakers absorb some of
the tax, then consumers do not pay "all" the taxes paid by suppliers.

Not contradictory at all, just different domains.

100% of the income for a baker derrives from the sale of goods (renting the
apartment upstairs would be a separate business, for example). Therefore,
the consumers pay every single penny of tax that the baker owes. Now, if
the baker's taxes increase significantly, market conditions may prevent the
baker from increasing product prices enough to fully cover those taxes. So,
part of what was the baker's profit now goes to the government. The
consumers still pay all the taxes the baker has, but the baker now gets less
pay.