CDZ Reducing Corporate income tax to world Norms

[william the wie]

How many trillions in revenue will it produce immediately and how much of an increase on an annual basis.

 

[Picaro]

How many trillions in revenue will it produce immediately and how much of an increase on an annual basis.

See all the 'private rulings' based on the tax code; the 'official' tax rates are a hoax as far as big companies go. GE for instance makes large profits of several billion dollars from their tax filings, effectively paying a negative tax rate, and many are already paying zero taxes now, despite all the wailing to the contrary. Some, like utilities and pipeline companies, are, or were until recently, allowed to collect Federal taxes from customers, but not have to give the revenue to the Feds after running it through master partnership set ups, as another example. Like Leona Helmsley once said, 'taxes are for the little people'. The real life tax rates in the U.S. are already comparable and even less than most countries.

So, no, it won't increase revenue, and certainly not anywhere near the 'trillions' number.

If you have never heard of 'private letter rulings', they are those special corporate and company bennies and the like that get buried in nearly every Bill passed by the Federal Legislatures, bought by lobbyists and usually only apply to specific industries and even just for individual companies that nobody else gets to use to reduce their taxes. The tax code looks 'all huge and complex n stuff', but for most people it isn't, as they aren't in the least affected by most of the arcana in it, they don't qualify for most of it. 'Private letter rulings' are for use strictly between the corporations concerned, and the general public is completely unaware of their existence at all.

The numbers of these 'private letter rulings' is vast, and decades of them exist:

Tax Information for Federal, State, and Local Governments

And, they're protected by secrecy laws re tax returns, so no one can ever find out what is in them.

Information for Governmental Liaisons

 

[Staidhup]

The backbone of private sector employment is small business, not GE, IBM, or Ford Motors.....

 

[william the wie]

The backbone of private sector employment is small business, not GE, IBM, or Ford Motors.....

True for employment which is why it is not the backbone of tax revenue.

 

[FA_Q2]

How many trillions in revenue will it produce immediately and how much of an increase on an annual basis.

See all the 'private rulings' based on the tax code; the 'official' tax rates are a hoax as far as big companies go. GE for instance makes large profits of several billion dollars from their tax filings, effectively paying a negative tax rate, and many are already paying zero taxes now, despite all the wailing to the contrary. Some, like utilities and pipeline companies, are, or were until recently, allowed to collect Federal taxes from customers, but not have to give the revenue to the Feds after running it through master partnership set ups, as another example. Like Leona Helmsley once said, 'taxes are for the little people'. The real life tax rates in the U.S. are already comparable and even less than most countries.

So, no, it won't increase revenue, and certainly not anywhere near the 'trillions' number.

If you have never heard of 'private letter rulings', they are those special corporate and company bennies and the like that get buried in nearly every Bill passed by the Federal Legislatures, bought by lobbyists and usually only apply to specific industries and even just for individual companies that nobody else gets to use to reduce their taxes. The tax code looks 'all huge and complex n stuff', but for most people it isn't, as they aren't in the least affected by most of the arcana in it, they don't qualify for most of it. 'Private letter rulings' are for use strictly between the corporations concerned, and the general public is completely unaware of their existence at all.

The numbers of these 'private letter rulings' is vast, and decades of them exist:

Tax Information for Federal, State, and Local Governments

And, they're protected by secrecy laws re tax returns, so no one can ever find out what is in them.

Information for Governmental Liaisons

That is the crux of the problem though - those massive companies do not pay a real tax rate when all of their possible competition is saddled with those rates. That needs to change.

Trump, being the big business man that he is and utilizing asinine tax breaks that should not exist but not eliminating them in his proposed tax plan, will not address this IMHO so changes that he makes will not do squat. I hope I am wrong in this though. In all honesty, the revenue from proposed tax changes does not really matter to me. The real change that needs to happen is in removing the crony capitalism that we currently experience and returning it to something closer to an actual free market.

 

[william the wie]

How many trillions in revenue will it produce immediately and how much of an increase on an annual basis.

See all the 'private rulings' based on the tax code; the 'official' tax rates are a hoax as far as big companies go. GE for instance makes large profits of several billion dollars from their tax filings, effectively paying a negative tax rate, and many are already paying zero taxes now, despite all the wailing to the contrary. Some, like utilities and pipeline companies, are, or were until recently, allowed to collect Federal taxes from customers, but not have to give the revenue to the Feds after running it through master partnership set ups, as another example. Like Leona Helmsley once said, 'taxes are for the little people'. The real life tax rates in the U.S. are already comparable and even less than most countries.

So, no, it won't increase revenue, and certainly not anywhere near the 'trillions' number.

If you have never heard of 'private letter rulings', they are those special corporate and company bennies and the like that get buried in nearly every Bill passed by the Federal Legislatures, bought by lobbyists and usually only apply to specific industries and even just for individual companies that nobody else gets to use to reduce their taxes. The tax code looks 'all huge and complex n stuff', but for most people it isn't, as they aren't in the least affected by most of the arcana in it, they don't qualify for most of it. 'Private letter rulings' are for use strictly between the corporations concerned, and the general public is completely unaware of their existence at all.

The numbers of these 'private letter rulings' is vast, and decades of them exist:

Tax Information for Federal, State, and Local Governments

And, they're protected by secrecy laws re tax returns, so no one can ever find out what is in them.

Information for Governmental Liaisons

That is the crux of the problem though - those massive companies do not pay a real tax rate when all of their possible competition is saddled with those rates. That needs to change.

Trump, being the big business man that he is and utilizing asinine tax breaks that should not exist but not eliminating them in his proposed tax plan, will not address this IMHO so changes that he makes will not do squat. I hope I am wrong in this though. In all honesty, the revenue from proposed tax changes does not really matter to me. The real change that needs to happen is in removing the crony capitalism that we currently experience and returning it to something closer to an actual free market.

I agree but McConnel has the bill ready for Trump's desk as soon as the new congress is seated.

 

[FA_Q2]

How many trillions in revenue will it produce immediately and how much of an increase on an annual basis.

See all the 'private rulings' based on the tax code; the 'official' tax rates are a hoax as far as big companies go. GE for instance makes large profits of several billion dollars from their tax filings, effectively paying a negative tax rate, and many are already paying zero taxes now, despite all the wailing to the contrary. Some, like utilities and pipeline companies, are, or were until recently, allowed to collect Federal taxes from customers, but not have to give the revenue to the Feds after running it through master partnership set ups, as another example. Like Leona Helmsley once said, 'taxes are for the little people'. The real life tax rates in the U.S. are already comparable and even less than most countries.

So, no, it won't increase revenue, and certainly not anywhere near the 'trillions' number.

If you have never heard of 'private letter rulings', they are those special corporate and company bennies and the like that get buried in nearly every Bill passed by the Federal Legislatures, bought by lobbyists and usually only apply to specific industries and even just for individual companies that nobody else gets to use to reduce their taxes. The tax code looks 'all huge and complex n stuff', but for most people it isn't, as they aren't in the least affected by most of the arcana in it, they don't qualify for most of it. 'Private letter rulings' are for use strictly between the corporations concerned, and the general public is completely unaware of their existence at all.

The numbers of these 'private letter rulings' is vast, and decades of them exist:

Tax Information for Federal, State, and Local Governments

And, they're protected by secrecy laws re tax returns, so no one can ever find out what is in them.

Information for Governmental Liaisons

That is the crux of the problem though - those massive companies do not pay a real tax rate when all of their possible competition is saddled with those rates. That needs to change.

Trump, being the big business man that he is and utilizing asinine tax breaks that should not exist but not eliminating them in his proposed tax plan, will not address this IMHO so changes that he makes will not do squat. I hope I am wrong in this though. In all honesty, the revenue from proposed tax changes does not really matter to me. The real change that needs to happen is in removing the crony capitalism that we currently experience and returning it to something closer to an actual free market.

I agree but McConnel has the bill ready for Trump's desk as soon as the new congress is seated.

A tax bill that reduces the overall rate.

Again, that is but one portion of the problem. The larger problem IMHO is the crony capitalism that has created an environment where big companies pay nothing and everyone else pays a large share.

Reduce the rate and eliminate special favors. THEN he will have accomplished something that may also generate revenue. Simply reducing the rate does nothing IMHO.

 

[william the wie]

I concur and that is what the proposed deal is supposed to do but I agree the proof is in the pudding

 

[FA_Q2]

We shall see and until then I will hope that you are right and the bill really does deal with crony tax laws.

 

[Picaro]

That is the crux of the problem though - those massive companies do not pay a real tax rate when all of their possible competition is saddled with those rates. That needs to change.

Yes, and tax bennies and subsidies for their competition to move their productiivity overseas is a number one priority. Most people don't realize those off-shoring companies are being subsidized; the 'maquilas' in Mexico and Central America, for instance, had their power, sewer, and other infrastructure built via U.S. programs like USAID. It wouldn't have been remotely viable for most of these companies to relocate their plants there if it weren't tied to taxpayers making them viable locations. As for countries like China, tax breaks and the various breaks given for overseas earnings are also ridiculous, and one reason tax rates go up here is because companies are being subsidized to move, reducing our own tax base and wages, and screwing the country on both ends, but these companies still want the ports and highways and all the rest of the goodies here but don't want to contribute to the tax bases necessary to keep that stuff functional.

Why should we be allowing companies to deduct other countries' taxes from what they report here? That is stupid from the get go; we aren't obligated to subsidize some foreign country's tax base at the expense of our own.

Trump, being the big business man that he is and utilizing asinine tax breaks that should not exist but not eliminating them in his proposed tax plan, will not address this IMHO so changes that he makes will not do squat.

Haven't seen his returns so don't know what he did, the mainstream media has less than zero credibility with me so I believe nothing they report any more, but amortizing losses over time doesn't seem outrageous to me, though like most tax laws I don't doubt at all that can be abused and warped.

I hope I am wrong in this though. In all honesty, the revenue from proposed tax changes does not really matter to me. The real change that needs to happen is in removing the crony capitalism that we currently experience and returning it to something closer to an actual free market.

It took 200 years of assorted corruption and cronyism to get the tax codes and regulatory dysfunction where it is today, so there isn't a quick fix, especially when the general public doesn't really care outside of a few minutes of whining at election time, citizenship is a verb, a government has to be watched all the time when the people are responsible for how well it functions, but most people overwhelmingly neglect it, then turn around and complain about the hired help.

 

[FA_Q2]

That is the crux of the problem though - those massive companies do not pay a real tax rate when all of their possible competition is saddled with those rates. That needs to change.

Yes, and tax bennies and subsidies for their competition to move their productiivity overseas is a number one priority. Most people don't realize those off-shoring companies are being subsidized; the 'maquilas' in Mexico and Central America, for instance, had their power, sewer, and other infrastructure built via U.S. programs like USAID. It wouldn't have been remotely viable for most of these companies to relocate their plants there if it weren't tied to taxpayers making them viable locations. As for countries like China, tax breaks and the various breaks given for overseas earnings are also ridiculous, and one reason tax rates go up here is because companies are being subsidized to move, reducing our own tax base and wages, and screwing the country on both ends, but these companies still want the ports and highways and all the rest of the goodies here but don't want to contribute to the tax bases necessary to keep that stuff functional.

Why should we be allowing companies to deduct other countries' taxes from what they report here? That is stupid from the get go; we aren't obligated to subsidize some foreign country's tax base at the expense of our own.

It is wrong to charge taxes on profits made overseas. Of course we should be allowing them to deduct taxes on those earnings. They are not allowed to do so with items sold here.

Aid to other nations is another thread altogether.

Companies do not offshore for taxes as much as they do to avoid regulatory realities. The EPA does not exist in China and compliance costs billions. Labor law does not exist in many countries throughout the world and paying people a dollar an hour for 16 hour days is a lot cheaper than minim wage here. That does not even count additional costs like unemployment and workman's comp.

Those regulatory costs add up fast.

Trump, being the big business man that he is and utilizing asinine tax breaks that should not exist but not eliminating them in his proposed tax plan, will not address this IMHO so changes that he makes will not do squat.

Haven't seen his returns so don't know what he did, the mainstream media has less than zero credibility with me so I believe nothing they report any more, but amortizing losses over time doesn't seem outrageous to me, though like most tax laws I don't doubt at all that can be abused and warped.

We have seen a portion of his returns and it was enough to know that he utilized a real estate break that should not exist.

In essence, he did not amortize actual losses but rather amortized GAINS that he was allowed to claim as losses. That particular piece of the tax code is not only insane but it is exactly flipped for average people - had someone been in a similar situation with their house rather than his casino they would actually OWE taxes. Such should have been eliminated.

He would have gained support if he claimed he took such a deduction but that it should not exist and he would eliminate it. Instead, he ignored its very existence even though it came out.

I hope I am wrong in this though. In all honesty, the revenue from proposed tax changes does not really matter to me. The real change that needs to happen is in removing the crony capitalism that we currently experience and returning it to something closer to an actual free market.

It took 200 years of assorted corruption and cronyism to get the tax codes and regulatory dysfunction where it is today, so there isn't a quick fix, especially when the general public doesn't really care outside of a few minutes of whining at election time, citizenship is a verb, a government has to be watched all the time when the people are responsible for how well it functions, but most people overwhelmingly neglect it, then turn around and complain about the hired help.

Sure there is a quick fix - flat rate taxation. Even consumption tax would be a 'quick' fix though I prefer a flat tax plan. It could be fixed in a year no matter how long the corrupt system has been in work. It has not been 200 years though - direct taxation is barely a century old.

You are right though, the people have neglected the government, citizenship obligations and continue to do so and that makes change unlikely. Congress will be very resistant to giving up its massive power in this area so the people would really need to force this and they are utterly complicit. It is a sad thing to see.

 

[jwoodie]

In essence, he did not amortize actual losses but rather amortized GAINS that he was allowed to claim as losses. That particular piece of the tax code is not only insane but it is exactly flipped for average people - had someone been in a similar situation with their house rather than his casino they would actually OWE taxes.

Please explain.

 

[FA_Q2]

In essence, he did not amortize actual losses but rather amortized GAINS that he was allowed to claim as losses. That particular piece of the tax code is not only insane but it is exactly flipped for average people - had someone been in a similar situation with their house rather than his casino they would actually OWE taxes.

Please explain.

He had a casino that went bankrupt and claimed a loss of just under a billion on it. IF he had invested a billion to build the property then such a deduction makes sense - he would have lost that money. That is not how these project work however - the vast majority of that initial cost to build the business would have been in loans. Loans that would have been forgiven as part of a bankruptcy. IOW, his business interests did not actually lose that money, the banks did. He claimed it though and that is totally legal.

If you manage to gain a loan forgiveness on a home you own then the story is massively different. If you were to have a short sale on a home valued at 200K, you owed 250K on that home and had that remaining 50K in loans forgive then you are required by law to report that as ordinary income and pay taxes on it. A LOT of taxes. A business OTOH takes that same situation and claims that 50K forgiveness as a LOSS and uses it to write off taxes.