If their costs are greater than the tax they pay, how come business can’t effectively pay 0 tax by righting off all these costs as a business expense?
In: 0
In general (in the US) they can.
Again generally speaking, businesses pay taxes on net income — income minus expenses. Some businesses will do speculative things with their income (expand the business, try new ideas, etc) in order to have their net income be as close to zero as possible and thus not pay income taxes (they will still pay other forms of tax such as employment taxes). The tax code is built to encourage this in order to spark business growth and development (usually to get more people hired and thus more employment tax and other economic system benefits).
Most companies don’t use this tactic because “most” companies exist to make a profit. They choose to not hit that 0 net profit and instead pay the taxes on the business income and record what’s left as profit for the owners.
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