How government threaten the existence of companies.

[TOZZIBLINKZ]

The government as a result of carrying out governmental activities and practices that concern the people disturb and threaten the existence off industries . government therefore is a machinery through which political activities like : provision of social amenities for the people , sponsoring of capital projects like roads , airport , seaport , railways refineries , and entertainment center are being carried out . The government therefore have good intentions for the people but in implementing this good intentions they subtly hinder and threaten the existence of industries . Below are some of these ways :

1. Area renovation : sometimes government could support and sponsor capital projects like the building of roads , airports and seaports in a particular area . This will lead to dimonishing and removal of buildings and private properties in order to clear the area for the project to begin , industries situated in this areas that are to be renovated are threatened since they will be sent packing.

2. High taxation rate : the life of an industry to be in existence could be threatened as a result of high taxation rate from the government . as a result of revenue allocation to the government government charge high taxation rate to private industries owned and controlled by private individuals .

 

[Jasz]

The government has way of affecting the existence of a business. The government is responsible for laws, which regulate and also protects business firms against unfair competition or unethical market practices. The government also provides legal protection over property and assets of a business firm.

Why thinking about this, It is not as if you would go directly to the government for selling your products provided that you have a monopoly in the market or some backed-up aid from the central bank. Certainly, the political power is good for controlling the corruption level and it is more effective than providing the absolute transparency in economic activities. However, managing expectations about economic performances is a tricky task for every business. The governments are also looking forward to give some boost in every phase of economic cycle.

Businesses exist in the context of both internal and external environments. Since businesses are subject to the rules, regulations and policies created by government entities, it is safe to say that government plays an important role in a business's existence.


The impact of the government in various businesses can not be overemphasized. So, we can see this in the use of tax, policies, subsidies and so on. we should bare this in mind while trying to have our various businesses.

 

[Caramelle]

The imposition of new taxes could kill industries. Inevitably, those taxes are passed on to the consumers or customers by way of higher prices or by direct tax mechanism. They may also be absorbed as product cost by companies that use the affected product as an ingredient, thus triggering price increases. This would likely stifle demand and hinder the growth of businesses, and eventually lead to massive loss of jobs. In extreme cases, companies would be forced to move their factories to another country where production would be less costly and the tax environment is more friendly. That is why passing a new tax law is something that should be done carefully and with the full benefits of scrutiny by an impartial legislature.

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