USAs high tax and laffer curve

[Euro]

USA world highest corporate tax but not much revenue.

To optimize the tax revenue a lower tax is needed and loopholes and populistic political decission must be ended.

A lower corporate tax will in the Laffer curve give a higher tax income for the government. The curve shows that a medium tax rate is the optimum, and Norway maximises its proffits with a medium tax rate. USA has the highest tax rate and one of the lowest revenues. I also find it odd that what they call the land of freedom etc. has the highest corporate tax in the world? Who would investe and create jobs if the taxes are the highest in the world. Socialist Norway actually has a lower corporate tax than USA. To low taxes as for Ireland isn’t great that either. It is theoretical, but loopholes and populistic politicians destroys the theory that works so well in Norway.

However I think USA has a lot of tax loopholes made by populistic politcians, but with no loopholes it works perfect for Norway. Socialist Norway with a lower tax than USA and also a higher profitt. So why not tighten the loopholes and cut the corporate tax to a lower/medium level

 

[Rshermr]

USA world highest corporate tax but not much revenue.

To optimize the tax revenue a lower tax is needed and loopholes and populistic political decission must be ended.

A lower corporate tax will in the Laffer curve give a higher tax income for the government. The curve shows that a medium tax rate is the optimum, and Norway maximises its proffits with a medium tax rate. USA has the highest tax rate and one of the lowest revenues. I also find it odd that what they call the land of freedom etc. has the highest corporate tax in the world? Who would investe and create jobs if the taxes are the highest in the world. Socialist Norway actually has a lower corporate tax than USA. To low taxes as for Ireland isn’t great that either. It is theoretical, but loopholes and populistic politicians destroys the theory that works so well in Norway.

However I think USA has a lot of tax loopholes made by populistic politcians, but with no loopholes it works perfect for Norway. Socialist Norway with a lower tax than USA and also a higher profitt. So why not tighten the loopholes and cut the corporate tax to a lower/medium level

The real issue is not the tax rate, but the actual tax rate PAID. While we have one of the highest PUBLISHED tax rates, we have among the lowest tax rates PAID. Due to extremely high tax deductions and other loopholes.
Here is a good investigative piece:
http://www.nytimes.com/2011/05/03/business/economy/03rates.html

 

[Euro]

USA world highest corporate tax but not much revenue.

To optimize the tax revenue a lower tax is needed and loopholes and populistic political decission must be ended.

A lower corporate tax will in the Laffer curve give a higher tax income for the government. The curve shows that a medium tax rate is the optimum, and Norway maximises its proffits with a medium tax rate. USA has the highest tax rate and one of the lowest revenues. I also find it odd that what they call the land of freedom etc. has the highest corporate tax in the world? Who would investe and create jobs if the taxes are the highest in the world. Socialist Norway actually has a lower corporate tax than USA. To low taxes as for Ireland isn’t great that either. It is theoretical, but loopholes and populistic politicians destroys the theory that works so well in Norway.

However I think USA has a lot of tax loopholes made by populistic politcians, but with no loopholes it works perfect for Norway. Socialist Norway with a lower tax than USA and also a higher profitt. So why not tighten the loopholes and cut the corporate tax to a lower/medium level

The real issue is not the tax rate, but the actual tax rate PAID. While we have one of the highest PUBLISHED tax rates, we have among the lowest tax rates PAID. Due to extremely high tax deductions and other loopholes.
Here is a good investigative piece:
http://www.nytimes.com/2011/05/03/business/economy/03rates.html

The tax system is very innefficient then and unfair. Have you thought of all the extra bureaucracy, paper work and adminsitration this gives. Not much left when all your taxes ends up in advanced paper work for bureaucrats.
A flat and lower tax is much simpler. Less bureaucracy more revenue.

 

[EdwardBaiamonte]

A flat and lower tax is much simpler. Less bureaucracy more revenue.

A little Econ 101 for you.

GE has 1000 tax people full time all to pay $0 last year. Its a massive waste of corporate efficiency. The solution is to eliminate the tax since it like any cost is passed on to customers.

We have it only because liberals hate business and think they are punishing business with the tax. They lack the IQ to know that business is a tax collector not a tax payer. Liberal politicans pander disgracefully to this pure ignorance.

 

[Euro]

A flat and lower tax is much simpler. Less bureaucracy more revenue.

A little Econ 101 for you.

GE has 1000 tax people full time all to pay $0 last year. Its a massive waste of corporate efficiency. The solution is to eliminate the tax since it like any cost is passed on to customers.

We have it only because liberals hate business and think they are punishing business with the tax. They lack the IQ to know that business is a tax collector not a tax payer. Liberal politicans pander disgracefully to this pure ignorance.

I agree on you on a lower and flater tax. The worlds highest tax on corporations in a recession is a problem, and the bureaucracy to find loopholes to. Taxes should be simple and flat.

From the Laffer curve you also see that this high tax actually gives the government less income than a lower tax. So it is very stupid to put the worlds highest tax on corporations.

 

[EdwardBaiamonte]

So it is very stupid to put the worlds highest tax on corporations.

its very very stupid to have any taxes on business at all since they are merely passed on to us , the consumers in higher prices.

 

[Rshermr]

So it is very stupid to put the worlds highest tax on corporations.

its very very stupid to have any taxes on business at all since they are merely passed on to us , the consumers in higher prices.

Lower taxes and fewer loopholes make sense. However, as soon as you take the old loopholes out, new ones will appear. Look at the deductions for the oil industry. Republican politicians holler like a stuck pig if you try to take them out. If you think that the loopholes came from other than corporations and the wealthy, and their paid politicians, you probably already own some swamp land.
Cons like the idea of no taxes for companies, saying they are only passed on to the public. However, it does not work that way. Taxes are part of the cost of doing business, providing the services that companies need. Please show me the country in the world that has no taxes on businesses. Don't think you will find one. The corporations will simply get richer when we pay their taxes.

 

[EdwardBaiamonte]

The corporations will simply get richer when we pay their taxes.

of course thats 100% and perfectly idiotic and liberal. If any cost like a tax or the cost of a raw material is eliminated at one company the savings must be passed on to customers or a competitor will pass it on through lower prices and bankrupt you.

Did you ever wonder why a car is priced more than an apple? Its because the true cost must be reflected in the price. Welcome to your first lesson in Econ 101.

 

[Rshermr]

The corporations will simply get richer when we pay their taxes.

of course thats 100% and perfectly idiotic and liberal. If any cost like a tax or the cost of a raw material is eliminated at one company the savings must be passed on to customers or a competitor will pass it on through lower prices and bankrupt you.

Did you ever wonder why a car is priced more than an apple? Its because the true cost must be reflected in the price. Welcome to your first lesson in Econ 101.

Ed,

I did not know that you believed yourself to be an economic scholar. Let me help you to reassess. You are an economics idiot.

In any basic econ class that goes into micro economics, you will find that price is not determined by cost but by supply and demand. For a number of reasons that would be too complex for you to understand (though quite simple for everyone else). Cost only determines profit margin of the product. If you are stupid enough to price your product based on cost, your competitors will indeed take you out, over time.

Of course, that is in a case of perfect competition, or the Market System. Of course, if you are GE, or Exxon, then you can price as you are able based on the elasticity of supply (again, I would explain this to you, but probably well beyond your simple mind).

And no, I never wondered about comparative prices between cars and apples. If you are wondering about that yourself, you should probably be committed. To the rest of us, the issue is obvious.

So, what you believe is that we should cover tax costs for corporations. And I asked you for examples of where that had been done. Obviously, you failed to find any.

Let me know when you need your next econ lesson. Hopefully, someone else will do it next time, Schooling idiots is boring.

 

[kiwiman127]

So it is very stupid to put the worlds highest tax on corporations.

its very very stupid to have any taxes on business at all since they are merely passed on to us , the consumers in higher prices.

Corporate America is the biggest user of the US infrastructure. So, you want them to not contribute a penny to enhance and maintain the American infrastructure that is funded by the tax payer? And it's because they can, at will, raise their prices?
That's thinking like a shill.

 

[Toro]

The corporations will simply get richer when we pay their taxes.

of course thats 100% and perfectly idiotic and liberal. If any cost like a tax or the cost of a raw material is eliminated at one company the savings must be passed on to customers or a competitor will pass it on through lower prices and bankrupt you.

Did you ever wonder why a car is priced more than an apple? Its because the true cost must be reflected in the price. Welcome to your first lesson in Econ 101.

Ed,

I did not know that you believed yourself to be an economic scholar. Let me help you to reassess. You are an economics idiot.

In any basic econ class that goes into micro economics, you will find that price is not determined by cost but by supply and demand. For a number of reasons that would be too complex for you to understand (though quite simple for everyone else). Cost only determines profit margin of the product. If you are stupid enough to price your product based on cost, your competitors will indeed take you out, over time.

Of course, that is in a case of perfect competition, or the Market System. Of course, if you are GE, or Exxon, then you can price as you are able based on the elasticity of supply (again, I would explain this to you, but probably well beyond your simple mind).

And no, I never wondered about comparative prices between cars and apples. If you are wondering about that yourself, you should probably be committed. To the rest of us, the issue is obvious.

So, what you believe is that we should cover tax costs for corporations. And I asked you for examples of where that had been done. Obviously, you failed to find any.

Let me know when you need your next econ lesson. Hopefully, someone else will do it next time, Schooling idiots is boring.

Supply is also a function of cost. If it costs less, then there will be more supply, all else considered. Ed is right about that.

Ed is not right that all taxes are passed along towards consumers. Some are, some are not. It depends on price elasticity. If prices are less elastic, more will be passed on to consumers. If prices are more elastic, the cost is born more so by shareholders. However, taxes will decrease supply since it increases costs. Eventually, the return on capital will recalibrate to its opportunity cost, and if the relative opportunity cost increases, capital will leave and supply will as well. If all taxes were passed on to the consumer, then corporations would never fight a tax increase, since it could merely be passed on to consumers. This, obviously, is not the case.

The Laffer curve is, for the most part, bullshit as it applies to income taxes in the US, except maybe at very high levels. But the empirical evidence is that cutting corporate taxes does increase total tax revenues since it increases economic activity. We should be cutting corporate income taxes in America and eliminating tax deductions, including many of the nonsense offshore tax-sheltering gimmicks companies use to shelter income.

 

[Rshermr]

of course thats 100% and perfectly idiotic and liberal. If any cost like a tax or the cost of a raw material is eliminated at one company the savings must be passed on to customers or a competitor will pass it on through lower prices and bankrupt you.

Did you ever wonder why a car is priced more than an apple? Its because the true cost must be reflected in the price. Welcome to your first lesson in Econ 101.

Ed,

I did not know that you believed yourself to be an economic scholar. Let me help you to reassess. You are an economics idiot.

In any basic econ class that goes into micro economics, you will find that price is not determined by cost but by supply and demand. For a number of reasons that would be too complex for you to understand (though quite simple for everyone else). Cost only determines profit margin of the product. If you are stupid enough to price your product based on cost, your competitors will indeed take you out, over time.

Of course, that is in a case of perfect competition, or the Market System. Of course, if you are GE, or Exxon, then you can price as you are able based on the elasticity of supply (again, I would explain this to you, but probably well beyond your simple mind).

And no, I never wondered about comparative prices between cars and apples. If you are wondering about that yourself, you should probably be committed. To the rest of us, the issue is obvious.

So, what you believe is that we should cover tax costs for corporations. And I asked you for examples of where that had been done. Obviously, you failed to find any.

Let me know when you need your next econ lesson. Hopefully, someone else will do it next time, Schooling idiots is boring.

Supply is also a function of cost. If it costs less, then there will be more supply, all else considered. Ed is right about that.

Ed is not right that all taxes are passed along towards consumers. Some are, some are not. It depends on price elasticity. If prices are less elastic, more will be passed on to consumers. If prices are more elastic, the cost is born more so by shareholders. However, taxes will decrease supply since it increases costs. Eventually, the return on capital will recalibrate to its opportunity cost, and if the relative opportunity cost increases, capital will leave and supply will as well. If all taxes were passed on to the consumer, then corporations would never fight a tax increase, since it could merely be passed on to consumers. This, obviously, is not the case.

The Laffer curve is, for the most part, bullshit as it applies to income taxes in the US, except maybe at very high levels. But the empirical evidence is that cutting corporate taxes does increase total tax revenues since it increases economic activity. We should be cutting corporate income taxes in America and eliminating tax deductions, including many of the nonsense offshore tax-sheltering gimmicks companies use to shelter income.

No, cost is not a determination of supply. Supply of manufactured product will not increase unless there is enough demand to buy the product at the PRICE that the product is being sold at. If costs go down, the
sellers may well be willing to sell for less, moving the price downward. Again supply and demand. Again, in a competitive market. However, if not competitive (ie, monopolistic) then all bets are off. Typically proffits will increase. Take for example, the increases in gas prices lately. Supply was up, demand was down, but prices increased. Why? Monopolistic industry which allows the seller to set prices.

Your statement that empirical evidence shows that lowering corporate taxes increases tax revenue would be good news for the Reagan economists, who found just the opposite. What is your bempirical evidence? I have been unable to find any. I keep asking, no one will provide the date of when this happened.

Another case you may want to look at is when w decreased taxes. Deficit again increased due to shrinking tax revenues. Where is the evidence???

 

[Peach]

USA world highest corporate tax but not much revenue.

To optimize the tax revenue a lower tax is needed and loopholes and populistic political decission must be ended.

A lower corporate tax will in the Laffer curve give a higher tax income for the government. The curve shows that a medium tax rate is the optimum, and Norway maximises its proffits with a medium tax rate. USA has the highest tax rate and one of the lowest revenues. I also find it odd that what they call the land of freedom etc. has the highest corporate tax in the world? Who would investe and create jobs if the taxes are the highest in the world. Socialist Norway actually has a lower corporate tax than USA. To low taxes as for Ireland isn’t great that either. It is theoretical, but loopholes and populistic politicians destroys the theory that works so well in Norway.

However I think USA has a lot of tax loopholes made by populistic politcians, but with no loopholes it works perfect for Norway. Socialist Norway with a lower tax than USA and also a higher profitt. So why not tighten the loopholes and cut the corporate tax to a lower/medium level

The real issue is not the tax rate, but the actual tax rate PAID. While we have one of the highest PUBLISHED tax rates, we have among the lowest tax rates PAID. Due to extremely high tax deductions and other loopholes.
Here is a good investigative piece:
http://www.nytimes.com/2011/05/03/business/economy/03rates.html

Yes, the RATE applies after deductions.

 

[Toro]

No, cost is not a determination of supply. Supply of manufactured product will not increase unless there is enough demand to buy the product at the PRICE that the product is being sold at. If costs go down, the
sellers may well be willing to sell for less, moving the price downward. Again supply and demand. Again, in a competitive market. However, if not competitive (ie, monopolistic) then all bets are off. Typically proffits will increase. Take for example, the increases in gas prices lately. Supply was up, demand was down, but prices increased. Why? Monopolistic industry which allows the seller to set prices.

A structural change in the cost curve will shift the supply curve causing a change in demand. So, if a new technology makes widgets cheaper to manufacturer, the supply curve shifts downward and demand increases. The increased demand is caused by the lowering of costs.

Your statement that empirical evidence shows that lowering corporate taxes increases tax revenue would be good news for the Reagan economists, who found just the opposite. What is your bempirical evidence? I have been unable to find any. I keep asking, no one will provide the date of when this happened.

Another case you may want to look at is when w decreased taxes. Deficit again increased due to shrinking tax revenues. Where is the evidence???

Tax cuts on corporate income increase the corporate tax share as a percentage of GDP

http://www.cato.org/pubs/tbb/tbb_1107_49.pdf

Decreasing payroll taxes and instituting a flat corporate income tax would triple entrepreneurial activity.

Taxes and Entrepreneurial Activity

Taxes on wireless services destroys more economic value than the tax revenues it brings in.

Taxes on Wireless Services Burden the Economy

Higher tax rates on labor income and consumption expenditures lead to less work time in the legal market sector, more time working in the household sector, a larger underground economy, and smaller shares of national output and employment in industries that rely heavily on low-wage, low-skill labor inputs.

Effects of Taxes on Labor Income

High Income Taxes Inhibit the Growth of Small Firms

High Income Taxes Inhibit the Growth of Small Firms

Taxes Discourage Mutual Fund Investors

Taxes Discourage Mutual Fund Investors

Differences in taxes across countries are a very important piece of the explanation for the vastly different levels of hours of market work hours of work in the United States were roughly the same in 1956 and 2004, while hours of work in Germany decreased by about 40 percent over this same period.

Higher Tax Rates Reduce Working Hours In OEC D Countries


There is also evidence that low taxes on natural resource royalties brings in more revenues than high taxes, but I can't be bothered to look for it at the moment.

 

[Rshermr]

No, cost is not a determination of supply. Supply of manufactured product will not increase unless there is enough demand to buy the product at the PRICE that the product is being sold at. If costs go down, the
sellers may well be willing to sell for less, moving the price downward. Again supply and demand. Again, in a competitive market. However, if not competitive (ie, monopolistic) then all bets are off. Typically proffits will increase. Take for example, the increases in gas prices lately. Supply was up, demand was down, but prices increased. Why? Monopolistic industry which allows the seller to set prices.

A structural change in the cost curve will shift the supply curve causing a change in demand. So, if a new technology makes widgets cheaper to manufacturer, the supply curve shifts downward and demand increases. The increased demand is caused by the lowering of costs.

Your statement that empirical evidence shows that lowering corporate taxes increases tax revenue would be good news for the Reagan economists, who found just the opposite. What is your bempirical evidence? I have been unable to find any. I keep asking, no one will provide the date of when this happened.

Another case you may want to look at is when w decreased taxes. Deficit again increased due to shrinking tax revenues. Where is the evidence???

Tax cuts on corporate income increase the corporate tax share as a percentage of GDP

http://www.cato.org/pubs/tbb/tbb_1107_49.pdf

Decreasing payroll taxes and instituting a flat corporate income tax would triple entrepreneurial activity.

Taxes and Entrepreneurial Activity

Taxes on wireless services destroys more economic value than the tax revenues it brings in.

Taxes on Wireless Services Burden the Economy

Higher tax rates on labor income and consumption expenditures lead to less work time in the legal market sector, more time working in the household sector, a larger underground economy, and smaller shares of national output and employment in industries that rely heavily on low-wage, low-skill labor inputs.

Effects of Taxes on Labor Income

High Income Taxes Inhibit the Growth of Small Firms

High Income Taxes Inhibit the Growth of Small Firms

Taxes Discourage Mutual Fund Investors

Taxes Discourage Mutual Fund Investors

Differences in taxes across countries are a very important piece of the explanation for the vastly different levels of hours of market work hours of work in the United States were roughly the same in 1956 and 2004, while hours of work in Germany decreased by about 40 percent over this same period.

Higher Tax Rates Reduce Working Hours In OEC D Countries


There is also evidence that low taxes on natural resource royalties brings in more revenues than high taxes, but I can't be bothered to look for it at the moment.

Jesus, I just asked for someone to come up with a time when decreasing taxes increased govt revenue, which was stated by some con as a fact. What I get are a series of links to misc. studies by right wing (CATO) or other unknown authors, about misc. economic issues and tax decreases.

Not sure what cost curve you are referring to. You are saying that a change in costs will result in a direct change in price. I would say that in a completely competitive industry, you would probably be correct. Depends. But in a monopolistic industry, it will likely not. As an example I used before, in the current gas price increases, supply was higher than it had been in years, but demand was lower than in years. Yet the prices of gas went UP. So in that case, your statement is untrue. As it would be, and ha

Today, we have a repub party that says we need to reduce taxes. In addition to decreasing govt spending, though they go hand in hand. In a bad economy. Still nothing about the issue. Take a look at the basic statistics of the Bureau of Labor Statistics, for beginners. That is a good non partial place to start.

And if you don't use politically partial sources, neither will I.

 

[KissMy]

Tax rates have no effect on tax revenue. It is all about tax collection enforcement & loopholes. The rich don't pay taxes unless they want to.

 

[EdwardBaiamonte]

If you are stupid enough to price your product based on cost, your competitors will indeed take you out, over time.

Econ 101:

a) if you price below cost you go bankrupt

b) if you price much above cost your competitors under sell you; you go bankrupt

Hence, price is directly related to cost in the long run

 

[Toro]

Jesus, I just asked for someone to come up with a time when decreasing taxes increased govt revenue, which was stated by some con as a fact. What I get are a series of links to misc. studies by right wing (CATO) or other unknown authors, about misc. economic issues and tax decreases.

That's not what you asked. What you asked was

Your statement that empirical evidence shows that lowering corporate taxes increases tax revenue would be good news for the Reagan economists, who found just the opposite. What is your bempirical evidence? I have been unable to find any. I keep asking, no one will provide the date of when this happened.

I have shown it to you. And all but one of those links comes from the National Bureau of Economic Research.

Which Reagan economists showed otherwise?

Not sure what cost curve you are referring to. You are saying that a change in costs will result in a direct change in price.

It is basic microeconomics. The market supply curve is the aggregation of the marginal cost curves.

Supply Curve
Supply and demand - Wikipedia, the free encyclopedia

If technology lowers costs, the supply curve will shift downward.

 

[EdwardBaiamonte]

If all taxes were passed on to the consumer, then corporations would never fight a tax increase, since it could merely be passed on to consumers.

all costs including taxes are passed on to consumers and in the long run profits are competitively reduced to zero thanks to the egalitarian nature of capitalism.

However, taxes are not applied evenly against single products, but rather unevenly against entire corporations; so each individual corporations will fight tooth and nail to reduce his taxes more than a competitor to gain a competitive edge against that competitor and against unseen competitors with substitute goods.

 

[KissMy]

Carried interest & investment income should be taxed the exact same way as employment income. Get rid of the loopholes & drop the top tax rate down to 29%.