A Profit tax where we actually know the Entire Cost Function Including the Opportunity cost(Time, Incommodation, best alternative for the easily monetized resources etc) is not distorting.

But the government does not know the Cost Function if Industries was allowed to report Cost Function it would 0 the profit.

Is there any Incentive Compatible mechanism for the Government to discover the Cost Function while being able to use such information to tax the Industry?


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