It's Time to Lower Corporate Taxes

[Politico]

LOL corporations pay very little tax at the end of the day. It is time to start penalizing them for not being here.

 

[Mac1958]

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If we lowered corporate tax rates to 10% (or lower), you'd see a flood of re-patrioted dollars, the likes of which you've never seen. You'd also see a flood of NEW foreign capital, the likes of which you've never seen.

But no, that would make too much sense.

Instead, we double down. We put taxes on our corporations that force them -- they have fiduciary (L-E-G-A-L) responsibilities to maximize shareholder value or be SUED, I wonder how many people know that -- to move all or parts of their operations overseas to save money. Then, when we force them to do that, we then want to punish them for doing their jobs, and take away their ability to compete in an increasingly competitive global business environment.

And the American Left whines when it is pointed out that they are anti-business. And they wonder why business is not willing to take undue risks in this environment.

You can't make this shit up.

.

 

[Agit8r]

America is uncompetitive from a tax standpoint. We have the highest corporate tax rate in the world. American companies are choosing to relocate abroad because we have become so uncompetitive.

Note in this article that Bill Clinton's former Chair of the Council of Economic Advisers agrees, and we are getting beaten on deals by companies in France. France! Rather than the President mealy-mouth companies about being unpatriotic, he and Congress have to get off their butts and do something about it.

Time to lower corporate taxes. I say to 15%. And get rid of all these ridiculous loopholes.

The U.S. has the highest corporate income-tax rate in the developed world. While U.S. corporations face a combined federal-state statutory tax rate of 39.1%, our competitors in the Organization for Economic Cooperation and Development (OECD) face an average rate of 25%.

According to Laura Tyson, former chairwoman of President Clinton's Council of Economic Advisers, "America's relatively high rate encourages U.S. companies to locate their investment, production, and employment in foreign countries, and discourages foreign companies from locating in the U.S., which means slower growth, fewer jobs, smaller productivity gains, and lower real wages." ...

At the same time, the U.S. adheres to a system of international taxation discarded by most other countries. American businesses are taxed on a world-wide basis regardless of where in the world revenue is earned. That means U.S. multinationals pay taxes twice, first to the foreign country in which they do business and then to the U.S. after they repatriate their profits. ...

As with the relatively high corporate tax rate, America's world-wide system of taxation hinders growth, encourages companies to relocate outside of the U.S., makes U.S.-based companies vulnerable to foreign takeover, and puts American businesses at a competitive disadvantage internationally.

At Emerson, the St. Louis-based manufacturing and technology company where I retired last year as vice chairman, the business has seen and experienced the deleterious effects of the U.S. tax code firsthand. Here is one example:

In 2006, Emerson sought to acquire a company called American Power Conversion (APC). This was a Rhode Island-based company that made more than half of its earnings outside the U.S. Unfortunately, Emerson competed against Schneider Electric, SU.FR +0.49% a French company, to acquire APC. Emerson offered more than $5 billion, but ultimately Schneider acquired APC by offering a bid in excess of $6 billion.

Why was Schneider willing to offer more? Schneider outbid us because France's tax code—typical of most OECD countries—exempts 95% of foreign-source income from taxation, while the U.S. tax code fully taxes such income. APC's profits were worth more to Schneider because, once absorbed, APC's global profits (net of the taxes paid in the countries where those profits were earned) could be repatriated to Schneider's headquarters in France, where they would be taxed at less than 2%.

In contrast, earnings repatriated to the U.S. are subject to a tax rate of nearly 40%, with a credit for taxes paid abroad on that income.

Walter Galvin: Why Corporate Inversions Are All the Rage - WSJ

Yes, and we should make up the revenue by taxing day-trades.

 

[Toddsterpatriot]

America is uncompetitive from a tax standpoint. We have the highest corporate tax rate in the world. American companies are choosing to relocate abroad because we have become so uncompetitive.

Note in this article that Bill Clinton's former Chair of the Council of Economic Advisers agrees, and we are getting beaten on deals by companies in France. France! Rather than the President mealy-mouth companies about being unpatriotic, he and Congress have to get off their butts and do something about it.

Time to lower corporate taxes. I say to 15%. And get rid of all these ridiculous loopholes.

The U.S. has the highest corporate income-tax rate in the developed world. While U.S. corporations face a combined federal-state statutory tax rate of 39.1%, our competitors in the Organization for Economic Cooperation and Development (OECD) face an average rate of 25%.

According to Laura Tyson, former chairwoman of President Clinton's Council of Economic Advisers, "America's relatively high rate encourages U.S. companies to locate their investment, production, and employment in foreign countries, and discourages foreign companies from locating in the U.S., which means slower growth, fewer jobs, smaller productivity gains, and lower real wages." ...

At the same time, the U.S. adheres to a system of international taxation discarded by most other countries. American businesses are taxed on a world-wide basis regardless of where in the world revenue is earned. That means U.S. multinationals pay taxes twice, first to the foreign country in which they do business and then to the U.S. after they repatriate their profits. ...

As with the relatively high corporate tax rate, America's world-wide system of taxation hinders growth, encourages companies to relocate outside of the U.S., makes U.S.-based companies vulnerable to foreign takeover, and puts American businesses at a competitive disadvantage internationally.

At Emerson, the St. Louis-based manufacturing and technology company where I retired last year as vice chairman, the business has seen and experienced the deleterious effects of the U.S. tax code firsthand. Here is one example:

In 2006, Emerson sought to acquire a company called American Power Conversion (APC). This was a Rhode Island-based company that made more than half of its earnings outside the U.S. Unfortunately, Emerson competed against Schneider Electric, SU.FR +0.49% a French company, to acquire APC. Emerson offered more than $5 billion, but ultimately Schneider acquired APC by offering a bid in excess of $6 billion.

Why was Schneider willing to offer more? Schneider outbid us because France's tax code—typical of most OECD countries—exempts 95% of foreign-source income from taxation, while the U.S. tax code fully taxes such income. APC's profits were worth more to Schneider because, once absorbed, APC's global profits (net of the taxes paid in the countries where those profits were earned) could be repatriated to Schneider's headquarters in France, where they would be taxed at less than 2%.

In contrast, earnings repatriated to the U.S. are subject to a tax rate of nearly 40%, with a credit for taxes paid abroad on that income.

Walter Galvin: Why Corporate Inversions Are All the Rage - WSJ

Yes, and we should make up the revenue by taxing day-trades.

Revenue would increase. That's why it makes sense to do it. Durrr.

 

[KissMy]

Time to lower corporate taxes. I say to 15%. And get rid of all these ridiculous loopholes.

Corps only pay 12.6% now. Workers pay about 40% with payroll tax. Everyone should be paying 18% total federal taxes. Time to raise corps effective tax, lower published tax rates on corps & lower payroll tax on workers.

 

[Toddsterpatriot]

Time to lower corporate taxes. I say to 15%. And get rid of all these ridiculous loopholes.

Corps only pay 12.6% now. Workers pay about 40% with payroll tax. Everyone should be paying 18% total federal taxes. Time to raise corps effective tax, lower published tax rates on corps & lower payroll tax on workers.

Workers pay about 40% with payroll tax.

How much does this theoretical 40% payer make in your example?

 

[Toro]

Time to lower corporate taxes. I say to 15%. And get rid of all these ridiculous loopholes.

Corps only pay 12.6% now. Workers pay about 40% with payroll tax. Everyone should be paying 18% total federal taxes. Time to raise corps effective tax, lower published tax rates on corps & lower payroll tax on workers.

There have been a few studies on the effective tax rate companies pay, and iirc, it's somewhere between 12% and 23%.

Drop it to 15% and close all the loopholes. I'd even take 18%.

 

[bendog]

What's the real purpose of a corporate income tax? I realize a tax is only justified if it's to raise needed money for a public use. But it also has to be applied in a way as to do the least damage to overall growth of the private sector. If we could raise roughly the same amount of money by taxing capital gains and higher end incomes, which is where most of the corporate stockholders reside, why not do that instead?

 

[Mac1958]

What's the real purpose of a corporate income tax? I realize a tax is only justified if it's to raise needed money for a public use. But it also has to be applied in a way as to do the least damage to overall growth of the private sector. If we could raise roughly the same amount of money by taxing capital gains and higher end incomes, which is where most of the corporate stockholders reside, why not do that instead?

Precisely. Lower/eliminate corporate tax rates, swim in the flood of re-patrioted dollars and new foreign investments that would follow, add two new marginal tax rates above the marginal rates we have now.

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[EdwardBaiamonte]

If we could raise roughly the same amount of money by taxing capital gains......... why not do that instead?

Venture capitalists pay capital gains tax. The more you tax their venture capital the fewer new ventures and new jobs there are and the slower the economy grows.

 

[EdwardBaiamonte]

What's the real purpose of a corporate income tax? I realize a tax is only justified if it's to raise needed money for a public use. But it also has to be applied in a way as to do the least damage to overall growth of the private sector. If we could raise roughly the same amount of money by taxing capital gains and higher end incomes, which is where most of the corporate stockholders reside, why not do that instead?

Precisely. Lower/eliminate corporate tax rates, swim in the flood of re-patrioted dollars and new foreign investments that would follow, add two new marginal tax rates above the marginal rates we have now.

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why add new marginal rates? THe economy would be booming with corps. moving back and far lower prices! Tax revenue would probably be way up.

 

[KissMy]

What's the real purpose of a corporate income tax? I realize a tax is only justified if it's to raise needed money for a public use. But it also has to be applied in a way as to do the least damage to overall growth of the private sector. If we could raise roughly the same amount of money by taxing capital gains and higher end incomes, which is where most of the corporate stockholders reside, why not do that instead?

Precisely. Lower/eliminate corporate tax rates, swim in the flood of re-patrioted dollars and new foreign investments that would follow, add two new marginal tax rates above the marginal rates we have now.

Incorporating your income should not give you a tax break. You are already sheltering your other wealth & income from risk, that is reward enough. No loopholes 19% minimum tax on carried interest, dividend, corps & any income over $250k with with a max combined total tax of anywhere between 19% to 29%. Make 17% the max combined payroll & income tax rate for everything below $250k.

 

[bendog]

What's the real purpose of a corporate income tax? I realize a tax is only justified if it's to raise needed money for a public use. But it also has to be applied in a way as to do the least damage to overall growth of the private sector. If we could raise roughly the same amount of money by taxing capital gains and higher end incomes, which is where most of the corporate stockholders reside, why not do that instead?

Precisely. Lower/eliminate corporate tax rates, swim in the flood of re-patrioted dollars and new foreign investments that would follow, add two new marginal tax rates above the marginal rates we have now.

.

why add new marginal rates? THe economy would be booming with corps. moving back and far lower prices! Tax revenue would probably be way up.

I don't know about rates. I think there would have to be an analysis to estimate the neutrality of any change from taxing corporate income to taxing the economic benefit that the owners of the corporation derive. I think you'd have to have the same rate on cap gains, or passive income, that is on wages for any income group or rate.

 

[bendog]

What's the real purpose of a corporate income tax? I realize a tax is only justified if it's to raise needed money for a public use. But it also has to be applied in a way as to do the least damage to overall growth of the private sector. If we could raise roughly the same amount of money by taxing capital gains and higher end incomes, which is where most of the corporate stockholders reside, why not do that instead?

Precisely. Lower/eliminate corporate tax rates, swim in the flood of re-patrioted dollars and new foreign investments that would follow, add two new marginal tax rates above the marginal rates we have now.

Incorporating your income should not give you a tax break. You are already sheltering your other wealth & income from risk, that is reward enough. No loopholes 19% minimum tax on corps & income over $250k with 17% max combined payroll & income tax rate for everything below $250k.

You cannot incorporate income. Corporate profit can only go to one of two places. Either it stays in the corporation or it is paid out to shareholders. If it stays in the corporation it goes to expansion, or paying off debt and then to expansion.

I suppose if there was no corporate tax, you might see corporations just putting profit in TBills or something and letting the money accumulate without ever paying it out. But so long as that money is eventually paid out, and taxed as ordinary income, I think the rational behavior would be just to either pay it out and let shareholders pay the tax, or have the corporation invest it whatever the management sees as the best bet to get return on the risk.

 

[KissMy]

Precisely. Lower/eliminate corporate tax rates, swim in the flood of re-patrioted dollars and new foreign investments that would follow, add two new marginal tax rates above the marginal rates we have now.

Incorporating your income should not give you a tax break. You are already sheltering your other wealth & income from risk, that is reward enough. No loopholes 19% minimum tax on corps & income over $250k with 17% max combined payroll & income tax rate for everything below $250k.

You cannot incorporate income. Corporate profit can only go to one of two places. Either it stays in the corporation or it is paid out to shareholders. If it stays in the corporation it goes to expansion, or paying off debt and then to expansion.

I suppose if there was no corporate tax, you might see corporations just putting profit in TBills or something and letting the money accumulate without ever paying it out. But so long as that money is eventually paid out, and taxed as ordinary income, I think the rational behavior would be just to either pay it out and let shareholders pay the tax, or have the corporation invest it whatever the management sees as the best bet to get return on the risk.

B.S. Corporate execs consume corporate income without it being taxed or paying it out in dividends. Corporate Luxury Yachts, Jets, Suits, events & parties are just a few ways they spend money without it being taxed as income. They expense season tickets to each-other for sporting events as cost of sales. It is a tax free lifestyle racket.

 

[Toddsterpatriot]

What's the real purpose of a corporate income tax? I realize a tax is only justified if it's to raise needed money for a public use. But it also has to be applied in a way as to do the least damage to overall growth of the private sector. If we could raise roughly the same amount of money by taxing capital gains and higher end incomes, which is where most of the corporate stockholders reside, why not do that instead?

Precisely. Lower/eliminate corporate tax rates, swim in the flood of re-patrioted dollars and new foreign investments that would follow, add two new marginal tax rates above the marginal rates we have now.

Incorporating your income should not give you a tax break. You are already sheltering your other wealth & income from risk, that is reward enough. No loopholes 19% minimum tax on carried interest, dividend, corps & any income over $250k with with a max combined total tax of anywhere between 19% to 29%. Make 17% the max combined payroll & income tax rate for everything below $250k.

No loopholes 19% minimum tax on corps & income over $250k

First $50,000 15.00%
$50,000-$75,000 25.00%
$75,000-$100,000 34.00%
$100,000-$335,000 39.00%
$335,000-$10,000,000 34.00%
$10,000,000-$15,000,000 35.00%
$15,000,000-$18,333,333 38.00%
Over $18,333,333 35.00%

http://www.irs.gov/pub/irs-soi/02corate.pdf

That would be a huge tax break for almost every corporation.

 

[Dad2three]

Precisely. Lower/eliminate corporate tax rates, swim in the flood of re-patrioted dollars and new foreign investments that would follow, add two new marginal tax rates above the marginal rates we have now.

Incorporating your income should not give you a tax break. You are already sheltering your other wealth & income from risk, that is reward enough. No loopholes 19% minimum tax on carried interest, dividend, corps & any income over $250k with with a max combined total tax of anywhere between 19% to 29%. Make 17% the max combined payroll & income tax rate for everything below $250k.

No loopholes 19% minimum tax on corps & income over $250k

First $50,000 15.00%
$50,000-$75,000 25.00%
$75,000-$100,000 34.00%
$100,000-$335,000 39.00%
$335,000-$10,000,000 34.00%
$10,000,000-$15,000,000 35.00%
$15,000,000-$18,333,333 38.00%
Over $18,333,333 35.00%

http://www.irs.gov/pub/irs-soi/02corate.pdf

That would be a huge tax break for almost every corporation.

That would be a huge tax break for almost every corporation.

EXCEPT almost NO Corp pays margin rates EXCEPT Corps that can't off shore their profits, Walmarts, Mc'D's, etc


EFFECTIVE tax rates are at 40+ year lows of around 12%

 

[Dad2three]

What's the real purpose of a corporate income tax? I realize a tax is only justified if it's to raise needed money for a public use. But it also has to be applied in a way as to do the least damage to overall growth of the private sector. If we could raise roughly the same amount of money by taxing capital gains and higher end incomes, which is where most of the corporate stockholders reside, why not do that instead?

Precisely. Lower/eliminate corporate tax rates, swim in the flood of re-patrioted dollars and new foreign investments that would follow, add two new marginal tax rates above the marginal rates we have now.

.

why add new marginal rates? THe economy would be booming with corps. moving back and far lower prices! Tax revenue would probably be way up.

lol Sure, lowest effective tax rate in 40 years, ONLY Chile and Mexico of the industrialized worlds are lower!

 

[Dad2three]

Might want to try that again...

Source: http://www.google.com/url?sa=t&rct=...6Mc37de57MKVpfmlBlMmwpA&bvm=bv.71778758,d.aWw

Page 5

A PRESS RELEASE? That proves it *shaking head*

One of the biggest aerospace companies in the world also flies by on some blessedly low tax rates. From 2004-2009, Boeing made $17.5 billion pre-taxes. That’s nothing to sneeze at. But they only paid $796 million in taxes, thanks to tax breaks on sales made outside the United States, and a full 38 subsidiaries in tax havens outside of the US. One estimate has the company’s 2007-9 tax rate at -0.8%; its tax rate since 2004 has hit a maximum of only 4.6%. Add the recent $35 billion federal military contract to the cockpit, and Boeing has a mighty sweet relationship with the government.

25 Corporations That Pay Less Taxes Than You Do


Corporate Taxpayers & Corporate Tax Dodgers 2008-10


http://www.ctj.org/corporatetaxdodgers/CorporateTaxDodgersReport.pdf

You post partisan hacks and yet refuse information direct from the horses mouth and I am supposed to take you seriously?

Off to ignore-land for you....

Yes, I'm supposed to take you seriously when you use a press release over a NON PARTISAN source that says the Corp is LYING TO YOU?

 

[Dad2three]

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If we lowered corporate tax rates to 10% (or lower), you'd see a flood of re-patrioted dollars, the likes of which you've never seen. You'd also see a flood of NEW foreign capital, the likes of which you've never seen.

But no, that would make too much sense.

Instead, we double down. We put taxes on our corporations that force them -- they have fiduciary (L-E-G-A-L) responsibilities to maximize shareholder value or be SUED, I wonder how many people know that -- to move all or parts of their operations overseas to save money. Then, when we force them to do that, we then want to punish them for doing their jobs, and take away their ability to compete in an increasingly competitive global business environment.

And the American Left whines when it is pointed out that they are anti-business. And they wonder why business is not willing to take undue risks in this environment.

You can't make this shit up.

.

Sure, like we saw with Dubya's 'repatriation' holiday in 2004 at 5% where it not only cost revenues BUT jobs?

Would Another Repatriation Tax Holiday Create Jobs?

GOV'T POLICY CAN STOP THIS CORP TAX AVOIDANCE PRETTY EASILY, IF THE GOP STEPPED UP. THEY REFUSE TOO. Weird you can't be honest about that!