Cut Corporate Tax Rates--Remove Loopholes

[DiamondDave]

I don't mean to confuse you DD.

It's just that it's so hard NOT to confuse somebody like you.

I am only confused by your stances and your inherent hypocrisy

 

[Tech_Esq]

Read my other link discussing the effective tax rate.

OK, I read it. No big surprises there except for the actual numbers. By the way it was not 2/3 of all corporations, the study was just about Fortune 500 companies. Corporations don't pay taxes for a reason. Congress provides them ways to avoid the tax. This is called a distortion in the market. In other words, a corporation left to its own devices would not have acted in that manner but for the intervention of Congress to incentivize the activity. (That slightly overstates it and there are nuances, but I'm not trying to write a book).

So, why does Congress incentivize these activities. Well, we are told to believe they do this in the public interest. Because government believe it is beneficial to the society to have the corporations act in this manner. Whether that is true in whole or in part is another matter.

The other alternative is that we make a rate with no loopholes. First, it will never happen because Congress will never give up the power to tinker with the way we all act. Second, the iron law of unintended consequences has a firm grip on this issue. As mentioned in your article Reagan passed TFRA in 1986. Now, I'm a big Reagan fan as you can see from my quotes, but this was one big ass mistake. It closed a ton of loopholes and as an unintended consequence (just as one example) we ended up with a butt load of new homeless people.

How are the two related? One of the loophole closed was the tax deductibility of rental property. So, rental property owners divested. Low income people were out on the street.

 

[editec]

I am only confused by your stances and your inherent hypocrisy

Yes, I know.

Not much I can do about that, really.

Silk purse, sow's ear and all that.

 

[xsited1]

You realize of course that this would actually RAISE the tax rate paid by corporations. Wasn't it last year that the GAO came out with a report that 2/3 of American corporations don't pay any corporate tax? The tax rate in the US for corporations is extremely low, comparatively speaking.

The Gap Between Statutory and Real Corporate Tax Rates

The data is from 2001-2003. A good chunk of that time was when we were in a recession, so the results from the study will be skewed. Some corporations had a net loss for the year so they didn't pay income taxes, and those that made money had more write-offs that normal. That pretty much invalidates the study.

 

[Skull Pilot]

You realize of course that this would actually RAISE the tax rate paid by corporations. Wasn't it last year that the GAO came out with a report that 2/3 of American corporations don't pay any corporate tax? The tax rate in the US for corporations is extremely low, comparatively speaking.

The Gap Between Statutory and Real Corporate Tax Rates

Here we go again. Broken record time.

Since more than half of US corps are subchapter S corporations and profits from subchapter S corporations are not reported on a corporate tax returns but rather on the individual tax returns of the S corporation share holders, of course most corporations don't pay a corporate tax but the tax is paid by the shareholders individually.

So if 50% of corporations are S corps and don't report taxes on a corporate tax return only 16% of corporations actually paid no taxes. Probably because they either ran at a loss or their prfits and expenses zeroed out.

But this can't be right because ALL corporations are greedy money grubbing employee abusing entities that should have to pay 100% tax.

GMAFB

The corporate tax rate is such a non issue. Virtually all corps pay out their profits to shareholders and by reinvesting in the company. All that money is taxed either as dividends and capital gains, or tax is collected when companies buy equipment, or if a company contracts labor the contractor pays taxes on that income etc etc etc etc etc etc.

So don't you worry Uncle Fucking Sam is getting his pound of flesh

 

[Ravi]

Here we go again. Broken record time.

Since more than half of US corps are subchapter S corporations and profits from subchapter S corporations are not reported on a corporate tax returns but rather on the individual tax returns of the S corporation share holders, of course most corporations don't pay a corporate tax but the tax is paid by the shareholders individually.

So if 50% of corporations are S corps and don't report taxes on a corporate tax return only 16% of corporations actually paid no taxes. Probably because they either ran at a loss or their prfits and expenses zeroed out.

But this can't be right because ALL corporations are greedy money grubbing employee abusing entities that should have to pay 100% tax.

GMAFB

As Techie pointed out, it was 2/3 of the Fortune 500 corps and I seriously doubt they are s-corps.

Your s-corps are paying at an individual rate not a corporate rate.

 

[GHook93]

Excluding Japan, most industrial nations have cut their corporate tax rates to be more competitive.

The big story though is Ireland.

Into the 1990's, Ireland was known as "the sick man of Europe" mostly because its workers had to leave Ireland to find work commensurate with workers' work skills.

In the early 90's, it drastically reduced its corporate tax rate, till reaching a low rate of 12 1/2% compared to our present 35%.

Major corporations poured into Ireland--jobs have soared ever since. Ireland is now more prosperous than all the major industrial nations of Europe.

A rate of 25%, in the U.S. would be a good start to be matched by removal of any loophole (no matter what you call it--credit, allowance, subsidy etc.) so that normal business expenses, are the only deductions.

Although Ireland has had this dramatic turnaround in increased jobs, increased revenues and a huge increase in living standards, most class warfare merchants on the Left--which is just about the entire left--ignore these highly desirable results.

The Left makes petty arguments about unrelated matters.

Attacking anything in any way relating to profit, seems to make them proud and certain that they just shared their wisdom with us--though hatred would often be a more accurate description.

As long as the nanny-state crowd, shows disdain for the single biggest entity of heroes in the country---those who create jobs, those who give us a choice of employment, so we don't have to be farmers or engage in some other unrewarding form of drudgery, as was the case before the Industrial Revolution started spreading wealth among the general population---that crowd feels certain that its reckless, unrelated comments are jewels of widsom.

Most of the Mainstream Media is in this group.

Hardly any members of the Mainstream Media, have ever risked a penny in their lives, yet they believe the government--which has no money of its own--is the basic solution to everything no matter how huge the cost.

EXACTLY!!! Who was proposing this? McCain! Who is against this and could possibly raise them? Obama

Truthfully if you want to have America turn the corner and actually win the trade war with China, India, Russia, Brazil, Mexico and the 3rd world, you need to remove the corporate tax, capital gains tax (on stocks), payroll tax and most importantly the income tax (most companies have a flow through taxation - which the owners are taxed on at a personal level vs entity level)!

How can we do this! The FAIR TAX!

Look at Dubai, the fastest growing corporate sector in the world! How are they doing it in one of the most instable regions of the world? Because of a 0% Corporate taxation!

 

[Skull Pilot]

As Techie pointed out, it was 2/3 of the Fortune 500 corps and I seriously doubt they are s-corps.

Your s-corps are paying at an individual rate not a corporate rate.

Still is a non issue.

The money a corp makes pays its employees. They pay taxes

The company pays dividends. Shareholders pay taxes,

The company contracts labor. the contractor pays taxes

The company leases a space, the lessor pays taxes

The company buys new equipment and supplies from vendors. Sales taxes are paid, the vendor pays its employees those employees pay taxes

Share holders pay capital gains taxes when stocks appreciate.

When share holders die their heirs pay death taxes.

The fact that a corp paid no taxes is meaningless. It either ran at a loss, broke even or paid more to shareholders.

Every red fucking cent that a corporation takes in and spends is taxed.

 

[editec]

EXACTLY!!! Who was proposing this? McCain! Who is against this and could possibly raise them? Obama

Truthfully if you want to have America turn the corner and actually win the trade war with China, India, Russia, Brazil, Mexico and the 3rd world, you need to remove the corporate tax, capital gains tax (on stocks), payroll tax and most importantly the income tax (most companies have a flow through taxation - which the owners are taxed on at a personal level vs entity level)!

How can we do this! The FAIR TAX!

Look at Dubai, the fastest growing corporate sector in the world! How are they doing it in one of the most instable regions of the world? Because of a 0% Corporate taxation!

Great perhaps you should join Halliburton Corporation and move there, then.

AFter all, Dubai is a monarchy.

And people who prefer corporative power above representational governments are probably more comfortable under an extremely paternal fascist monarchical goverment than living in something messy like a democracy, anyway.

And just think, no corporate taxes, either.

It's a swell place as you can read here; Dubai - Wikipedia, the free encyclopedia

Shall I book your flight today?

 

[Tech_Esq]

Great perhaps you should join Halliburton Corporation and move there, then.

AFter all, Dubai is a monarchy.

And people who prefer corporative power above representational governments are probably more comfortable under an extremely paternal fascist monarchical goverment than living in something messy like a democracy, anyway.

And just think, no corporate taxes, either.

It's a swell place as you can read here; Dubai - Wikipedia, the free encyclopedia

Shall I book your flight today?

Interestingly, I have a client that is moving thier HQ from Dubai to DC.

 

[Ravi]

Still is a non issue.

The money a corp makes pays its employees. They pay taxes

The company pays dividends. Shareholders pay taxes,

The company contracts labor. the contractor pays taxes

The company leases a space, the lessor pays taxes

The company buys new equipment and supplies from vendors. Sales taxes are paid, the vendor pays its employees those employees pay taxes

Share holders pay capital gains taxes when stocks appreciate.

When share holders die their heirs pay death taxes.

The fact that a corp paid no taxes is meaningless. It either ran at a loss, broke even or paid more to shareholders.

Every red fucking cent that a corporation takes in and spends is taxed.

The same could be said about any money spent.

My original point was that corporations effectively pay less taxes than an individual (except on an individual's capital gains). Why should corporations have a lower tax rate? Sometimes you guys like to treat corporations as individuals and sometimes you want to treat them as if they enjoy special privileges that individuals don't enjoy.

btw, have you made the switch from being an s-corp yet?

 

[Skull Pilot]

My point is: so what?

Corporations don't make a profit and sit on it. It's not income in the same sense as individual income because all profit ultimately belongs to the shareholders.

And besides individuals almost never pay the statutory rate either. After all deductions and tax credits etc an individuals rate is certainly less than the statutory rate.

I just don't understand how you all think more taxes are a good thing.

You want to restore democracy, you want to have "fairness", you want to have freedom and liberty and you think the government confiscating more of your and everyone else's money is the way to achieve that.

Here's a novel idea, let us all keep more of our money and see what happens. I'll bet the country and everyone in it will be better off. There is no freedom without economic freedom and the root of economic freedom is that one retains the fruits of one's labor.

I have no problem paying taxes to the government IF those taxes are not excessive as they are now and IF the government was as responsible with the money it takes from me as I am with the money the government allows me to keep.

The answer is not more taxes. The answer is we make the government smaller first by allowing it to confiscate less of our money and fiscally responsible second by forcing it to spend less.

 

[GHook93]

Great perhaps you should join Halliburton Corporation and move there, then.

AFter all, Dubai is a monarchy.

And people who prefer corporative power above representational governments are probably more comfortable under an extremely paternal fascist monarchical goverment than living in something messy like a democracy, anyway.

And just think, no corporate taxes, either.

It's a swell place as you can read here; Dubai - Wikipedia, the free encyclopedia

Shall I book your flight today?

OUCH! Don't shoot the messager! I was pointing out that a country who dropped their corporate tax to 0% is a booming corporate sector and you attack me for pointing that out!

I know to the left, the state of the American economy is all because of Bush, he did it all and when the Mesa takes over everything will be fixed! Yet we need to look to see why our corporations are increasing going over-seas. Why China has surpassed us manufacturing sector!

You must face the fact that the US is in a world-wide trade war and we don't have the best soldiers to fight it at the moment. We are at economic attack by BRIC (Brazil, Russia, India and China), EU (who is getting wooped also), Japan, Mexico, Indonesia, South Korea, Mayalsia etc and we are losing!

 

[Ravi]

My point is: so what?

Just commenting on the OP. The person that posted it didn't seem to realize that corporate taxes at 25% with no loopholes would be more taxes than corporations now pay.

But I think also that corporations shouldn't have a lower tax rate than moi.

 

[Skull Pilot]

Just commenting on the OP. The person that posted it didn't seem to realize that corporate taxes at 25% with no loopholes would be more taxes than corporations now pay.

But I think also that corporations shouldn't have a lower tax rate than moi.

After all the deductions on your 1040 what was the actual percentage of your gross income paid in taxes?

 

[Tech_Esq]

After all the deductions on your 1040 what was the actual percentage of your gross income paid in taxes?

Turbotax used to have that feature. We do it online now. But a couple of years ago it said my effective tax rate was 6%.

 

[Skull Pilot]

Turbotax used to have that feature. We do it online now. But a couple of years ago it said my effective tax rate was 6%.

And when I say a flat tax of 10% would be enough for the government to take people recoil in horror.

How on earth can the government take care of us on only a 10% tax? My god we'll all just die

 

[Ravi]

After all the deductions on your 1040 what was the actual percentage of your gross income paid in taxes?

I'll figure it out and let you know.

 

[editec]

It won't work because those who pay nothing now want to keep riding for free.

It would work if they were making enough money to begin with.

It won't work because the rich want to keep making all the fucking money, Skull.

Think I'm wrong?

Okay, what is the top pay rate you think anyone should make?

And what is the bottom rate you think anyone should make?

You think those questions don't make sense, don't you?

Well then, you're just going to have to accept the fact that in order for there to be multibillionaires, there's going to have to be a whole forking lot of people who don't make enough to pay ANY federal income taxes.

Most of those people are paying a higher percentage of their incomes in all taxes, than most billionaires, anyway.

Can't have it both ways, amigo.

 

[Ravi]

Just under 22%