What should be done, if anything, to bring home $5 trillion held overseas by American businesses?

[ColonelAngus]

The income tax rate that you've quoted doesn't take into account the deductions that are typical. As for updated information, here's a chart that shows it's only gone down since 2000-2005. Also, despite all those concessions, the employment rate hasn't improved.

For some odd reason, people simply don't realize the difference between marginal and effective tax rates. One would think after Mitt Romney released his taxes that people would understand that difference, but, sure as God made little green apples, many appear not to.

Simply put, if one's marginal tax rate is, say 25% and one's deductions and exemptions allow one to actually pay tax such that one's effective rate is 15%, with no change other than a reduction in one's marginal tax rate from 25% to 15%, one will pay the same sum of money in taxes.

OT:
That chart may be among the best one's I've seen recently that illustrates the lie that is one of the main supply siders' mantras: cutting corporate taxes increases job growth.

15% across the board, no deductions. That's what I would like to see for all Federal Income tax.

 

[usmbguest5318]

What would you recommend, going full third-world?

I'd like to see 15%.

Fresh data. 2000-2005?

In 2014 the United States had the third highest general top marginal corporate income tax rate in the world at 39.1 percent (consisting of the 35% federal rate plus a combined state rate), exceeded only by Chad and the United Arab Emirates.

The income tax rate that you've quoted doesn't take into account the deductions that are typical. As for updated information, here's a chart that shows it's only gone down since 2000-2005. Also, despite all those concessions, the employment rate hasn't improved.

For regular income tax purposes, a system of graduated marginal tax rates is applied to all taxable income, including capital gains. Through 2015, the marginal tax rates on a corporation's taxable income are as follows:

Taxable income ($) Tax rate
0 to 50,000 - 15%
50,000 to 75,000 - $7,500 + 25% Of the amount over 50,000
75,000 to 100,000 - $13,750 + 34% Of the amount over 75,000
100,000 to 335,000 - $22,250 + 39% Of the amount over 100,000
335,000 to 10,000,000 - $113,900 + 34% Of the amount over 335,000
10,000,000 to 15,000,000 - $3,400,000 + 35% Of the amount over 10,000,000
15,000,000 to 18,333,333 - $5,150,000 + 38% Of the amount over 15,000,000
18,333,333 and up 35%

I'd like to see 15% across the board.

Would that provide enough revenue to keep the government providing the services that are required?

Revenues will go up for many companies that currently seek tax shelters.

If the rate was a flat 15%, there would be no need to shelter. It would also allow companies to reinvest in people and expand capacities.

35% of $0 = $0
15% of $1 = 15 cents.

If the rate was a flat 15%, there would be no need to shelter.

There is no basis for thinking that is at all the behavior that we would observe. If the rate is 15%, companies will seek to "shelter" it to avoid paying 15% and instead pay at a lower rate, or not pay any income tax at all. Take the case of Google which "shelters" its earnings in Bermuda, which has a zero percent corporate tax rate.

What on Earth leads you to think that a company would not "shelter" its income and thus pay 15% on its earnings rather than pay no tax at all on them?

 

[Cecilie1200]

What lost revenue? That's money that's overseas right now.
.

Mac you know that other countries have money in US too... The Saudis alone have 1 trillion in US....

5 Trillion abroad is not that much...

Yes, well, people who yarp about trade deficits and "money going overseas" tend to miss the part where the people overseas exporting and selling items in the US then take that money and invest it in US financial securities, which balances out pretty nicely against the so-called "trade deficit".

If that were true, it wouldn't be considered a trade deficit.

Yes, because inaccurate titles are NEVER applied to things by people with flawed understanding of them.

I think you're referring to yourself here. You've apparently confused merchandise balance with trade balance.

Although less general than trade balance, which includes both goods and services, the "merchandise balance", which includes only goods and not services, is sometime used because of better data availability.

Trade balance: a key concept in Economics

Nope. I think YOU just don't understand that there are all kinds of trade, and you're focusing on just one aspect.

I do find it amusing that you think a blanket "No, YOU are!" response is useful, though. If I'm "referring to myself" in regards to applying titles - inappropriate or otherwise - perhaps you could tell me what title I've applied, hmmm?

 

[JoeNormal]

Mac you know that other countries have money in US too... The Saudis alone have 1 trillion in US....

5 Trillion abroad is not that much...

Yes, well, people who yarp about trade deficits and "money going overseas" tend to miss the part where the people overseas exporting and selling items in the US then take that money and invest it in US financial securities, which balances out pretty nicely against the so-called "trade deficit".

If that were true, it wouldn't be considered a trade deficit.

Yes, because inaccurate titles are NEVER applied to things by people with flawed understanding of them.

I think you're referring to yourself here. You've apparently confused merchandise balance with trade balance.

Although less general than trade balance, which includes both goods and services, the "merchandise balance", which includes only goods and not services, is sometime used because of better data availability.

Trade balance: a key concept in Economics

Nope. I think YOU just don't understand that there are all kinds of trade, and you're focusing on just one aspect.

I do find it amusing that you think a blanket "No, YOU are!" response is useful, though. If I'm "referring to myself" in regards to applying titles - inappropriate or otherwise - perhaps you could tell me what title I've applied, hmmm?

You implied that I had applied an inaccurate title to trade deficit. I showed you that it was indeed accurate and gave you the benefit of the doubt that you have some sense of what you're talking about by offering 'merchandise balance' as a possibility.

If you stand by your assertion that trade deficit doesn't include financial services then back it up.

 

[usmbguest5318]

Two-year tax amnesty.

should we end the drug war for two years to compensate for lost revenue?

What lost revenue? That's money that's overseas right now.
.

Mac you know that other countries have money in US too... The Saudis alone have 1 trillion in US....

5 Trillion abroad is not that much...

Yes, well, people who yarp about trade deficits and "money going overseas" tend to miss the part where the people overseas exporting and selling items in the US then take that money and invest it in US financial securities, which balances out pretty nicely against the so-called "trade deficit".

If that were true, it wouldn't be considered a trade deficit.

Trade deficits too are things most people don't understand, as illustrated by the other member's remark that foreign entities'/individuals' investments in the U.S. make up for the trade deficit. Such investments cannot compensate for a deficit in trade because foreigners purchasing goods/services in the U.S. is not the same thing as the U.S. exporting goods/services for sale in a foreign country.

The U.S. trade deficit is the deficiency in the value of U.S. goods/services exported over the value of U.S. goods/services imported. When someone buys "whatever" in the U.S., that counts as domestic sale, not as an export/foreign sale. It doesn't matter whether the buyer is a foreigner or U.S. citizen/resident.

I don't know how someone can,in their mind, equate "foreign consumer buying in the U.S." with "U.S. seller selling their product abroad," but obviously, some people find a way to to do so.

 

[ColonelAngus]

I'd like to see 15%.

Fresh data. 2000-2005?

In 2014 the United States had the third highest general top marginal corporate income tax rate in the world at 39.1 percent (consisting of the 35% federal rate plus a combined state rate), exceeded only by Chad and the United Arab Emirates.

The income tax rate that you've quoted doesn't take into account the deductions that are typical. As for updated information, here's a chart that shows it's only gone down since 2000-2005. Also, despite all those concessions, the employment rate hasn't improved.

For regular income tax purposes, a system of graduated marginal tax rates is applied to all taxable income, including capital gains. Through 2015, the marginal tax rates on a corporation's taxable income are as follows:

Taxable income ($) Tax rate
0 to 50,000 - 15%
50,000 to 75,000 - $7,500 + 25% Of the amount over 50,000
75,000 to 100,000 - $13,750 + 34% Of the amount over 75,000
100,000 to 335,000 - $22,250 + 39% Of the amount over 100,000
335,000 to 10,000,000 - $113,900 + 34% Of the amount over 335,000
10,000,000 to 15,000,000 - $3,400,000 + 35% Of the amount over 10,000,000
15,000,000 to 18,333,333 - $5,150,000 + 38% Of the amount over 15,000,000
18,333,333 and up 35%

I'd like to see 15% across the board.

Would that provide enough revenue to keep the government providing the services that are required?

Revenues will go up for many companies that currently seek tax shelters.

If the rate was a flat 15%, there would be no need to shelter. It would also allow companies to reinvest in people and expand capacities.

35% of $0 = $0
15% of $1 = 15 cents.

If the rate was a flat 15%, there would be no need to shelter.

There is no basis for thinking that is at all the behavior that we would observe. If the rate is 15%, companies will seek to "shelter" it to avoid paying 15% and instead pay at a lower rate, or not pay any income tax at all. Take the case of Google which "shelters" its earnings in Bermuda, which has a zero percent corporate tax rate.

What on Earth leads you to think that a company would not "shelter" its income and thus pay 15% on its earnings rather than pay no tax at all on them?

Revenues - costs - expenses = net income.

15% of EBITDA should be taxed.

 

[usmbguest5318]

The income tax rate that you've quoted doesn't take into account the deductions that are typical. As for updated information, here's a chart that shows it's only gone down since 2000-2005. Also, despite all those concessions, the employment rate hasn't improved.

For regular income tax purposes, a system of graduated marginal tax rates is applied to all taxable income, including capital gains. Through 2015, the marginal tax rates on a corporation's taxable income are as follows:

Taxable income ($) Tax rate
0 to 50,000 - 15%
50,000 to 75,000 - $7,500 + 25% Of the amount over 50,000
75,000 to 100,000 - $13,750 + 34% Of the amount over 75,000
100,000 to 335,000 - $22,250 + 39% Of the amount over 100,000
335,000 to 10,000,000 - $113,900 + 34% Of the amount over 335,000
10,000,000 to 15,000,000 - $3,400,000 + 35% Of the amount over 10,000,000
15,000,000 to 18,333,333 - $5,150,000 + 38% Of the amount over 15,000,000
18,333,333 and up 35%

I'd like to see 15% across the board.

Would that provide enough revenue to keep the government providing the services that are required?

Revenues will go up for many companies that currently seek tax shelters.

If the rate was a flat 15%, there would be no need to shelter. It would also allow companies to reinvest in people and expand capacities.

35% of $0 = $0
15% of $1 = 15 cents.

If the rate was a flat 15%, there would be no need to shelter.

There is no basis for thinking that is at all the behavior that we would observe. If the rate is 15%, companies will seek to "shelter" it to avoid paying 15% and instead pay at a lower rate, or not pay any income tax at all. Take the case of Google which "shelters" its earnings in Bermuda, which has a zero percent corporate tax rate.

What on Earth leads you to think that a company would not "shelter" its income and thus pay 15% on its earnings rather than pay no tax at all on them?

Revenues - costs - expenses = net income.

15% of EBITDA should be taxed.

I'm fine with that, provided it's EBITDA as reported in the company's (the parent/holding company, not the wholly or partially owned subs') 10K. And, yes, that would solve the "sheltering" problem because the sums reported in the consolidated statement of income are global sums.

 

[ColonelAngus]

For regular income tax purposes, a system of graduated marginal tax rates is applied to all taxable income, including capital gains. Through 2015, the marginal tax rates on a corporation's taxable income are as follows:

Taxable income ($) Tax rate
0 to 50,000 - 15%
50,000 to 75,000 - $7,500 + 25% Of the amount over 50,000
75,000 to 100,000 - $13,750 + 34% Of the amount over 75,000
100,000 to 335,000 - $22,250 + 39% Of the amount over 100,000
335,000 to 10,000,000 - $113,900 + 34% Of the amount over 335,000
10,000,000 to 15,000,000 - $3,400,000 + 35% Of the amount over 10,000,000
15,000,000 to 18,333,333 - $5,150,000 + 38% Of the amount over 15,000,000
18,333,333 and up 35%

I'd like to see 15% across the board.

Would that provide enough revenue to keep the government providing the services that are required?

Revenues will go up for many companies that currently seek tax shelters.

If the rate was a flat 15%, there would be no need to shelter. It would also allow companies to reinvest in people and expand capacities.

35% of $0 = $0
15% of $1 = 15 cents.

If the rate was a flat 15%, there would be no need to shelter.

There is no basis for thinking that is at all the behavior that we would observe. If the rate is 15%, companies will seek to "shelter" it to avoid paying 15% and instead pay at a lower rate, or not pay any income tax at all. Take the case of Google which "shelters" its earnings in Bermuda, which has a zero percent corporate tax rate.

What on Earth leads you to think that a company would not "shelter" its income and thus pay 15% on its earnings rather than pay no tax at all on them?

Revenues - costs - expenses = net income.

15% of EBITDA should be taxed.

I'm fine with that, provided it's EBITDA as reported in the company's 10K. And yes, that would solve the "sheltering" problem because the sums reported in the consolidated statement of income are global sums.

See that. We agree.

Apple's EBITDA for 2016 was about $70 B.

15% of that would be $10.5 billion,

Seems reasonable to me.

 

[usmbguest5318]

Would that provide enough revenue to keep the government providing the services that are required?

Revenues will go up for many companies that currently seek tax shelters.

If the rate was a flat 15%, there would be no need to shelter. It would also allow companies to reinvest in people and expand capacities.

35% of $0 = $0
15% of $1 = 15 cents.

If the rate was a flat 15%, there would be no need to shelter.

There is no basis for thinking that is at all the behavior that we would observe. If the rate is 15%, companies will seek to "shelter" it to avoid paying 15% and instead pay at a lower rate, or not pay any income tax at all. Take the case of Google which "shelters" its earnings in Bermuda, which has a zero percent corporate tax rate.

What on Earth leads you to think that a company would not "shelter" its income and thus pay 15% on its earnings rather than pay no tax at all on them?

Revenues - costs - expenses = net income.

15% of EBITDA should be taxed.

I'm fine with that, provided it's EBITDA as reported in the company's 10K. And yes, that would solve the "sheltering" problem because the sums reported in the consolidated statement of income are global sums.

See that. We agree.

Apple's EBITDA for 2016 was about $70 B.

15% of that would be $10.5 billion,

Seems reasonable to me.

See that. We agree.

Yes, we now do.

Whether we did before you added a degree of specificity is unknown to me for it may be that you earlier had in mind what you subsequently clarified. Regardless, we do now concur on an solution approach to eliminating the "sheltering" problem/loophole.

 

[ColonelAngus]

Revenues will go up for many companies that currently seek tax shelters.

If the rate was a flat 15%, there would be no need to shelter. It would also allow companies to reinvest in people and expand capacities.

35% of $0 = $0
15% of $1 = 15 cents.

If the rate was a flat 15%, there would be no need to shelter.

There is no basis for thinking that is at all the behavior that we would observe. If the rate is 15%, companies will seek to "shelter" it to avoid paying 15% and instead pay at a lower rate, or not pay any income tax at all. Take the case of Google which "shelters" its earnings in Bermuda, which has a zero percent corporate tax rate.

What on Earth leads you to think that a company would not "shelter" its income and thus pay 15% on its earnings rather than pay no tax at all on them?

Revenues - costs - expenses = net income.

15% of EBITDA should be taxed.

I'm fine with that, provided it's EBITDA as reported in the company's 10K. And yes, that would solve the "sheltering" problem because the sums reported in the consolidated statement of income are global sums.

See that. We agree.

Apple's EBITDA for 2016 was about $70 B.

15% of that would be $10.5 billion,

Seems reasonable to me.

See that. We agree.

Yes, we now do.

Whether we did before you added a degree of specificity is unknown to me for it may be that you earlier had in mind what you subsequently clarified. Regardless, we do now concur on an solution approach to eliminating the "sheltering" problem/loophole.

Absolutely. That's the whole thing. That's why I prefer flat taxes.

Just like if you and I buy bubble gum at the same store, we will pay the same tax.

Personal income tax should be done the same way.

We are way over taxed.

We are taxed when we earn money. We are taxed when we invest. We are taxed when we save. We are taxed when we spend. Companies pay tax on the money we give them for their products and services. Obama took away or lowered MANY deductions. (Medical expense deductions now have to be 10% of your AGI, it was 7.5%. That's just one example)

About 40% of those taxes for the FED go to entitlements.

 

[usmbguest5318]

Would that provide enough revenue to keep the government providing the services that are required?

Revenues will go up for many companies that currently seek tax shelters.

If the rate was a flat 15%, there would be no need to shelter. It would also allow companies to reinvest in people and expand capacities.

35% of $0 = $0
15% of $1 = 15 cents.

If the rate was a flat 15%, there would be no need to shelter.

There is no basis for thinking that is at all the behavior that we would observe. If the rate is 15%, companies will seek to "shelter" it to avoid paying 15% and instead pay at a lower rate, or not pay any income tax at all. Take the case of Google which "shelters" its earnings in Bermuda, which has a zero percent corporate tax rate.

What on Earth leads you to think that a company would not "shelter" its income and thus pay 15% on its earnings rather than pay no tax at all on them?

Revenues - costs - expenses = net income.

15% of EBITDA should be taxed.

I'm fine with that, provided it's EBITDA as reported in the company's 10K. And yes, that would solve the "sheltering" problem because the sums reported in the consolidated statement of income are global sums.

See that. We agree.

Apple's EBITDA for 2016 was about $70 B.

15% of that would be $10.5 billion,

Seems reasonable to me.

Apple's EBITDA for 2016 was about $70 B.

15% of that would be $10.5 billion, Seems reasonable to me.

In all honestly, the specific tax rate and resulting sums paid from applying that rate to income (EBITDA) isn't something over which I'm all that fussed. So long as the totality of earnings are "captured" and the tax rate applied to them, I'm good. You an others can "carry on" about the rate and sums collected/paid.

FWIW, however, yes, 15% seems like a reasonable tax rate to me, but then so does 10%, 20% or even 25% because the effective rate of only a relatively few individuals exceeds 25%; thus it's seems appropriate that corporations should, seeing as they have "person status" in law, pay at a rate roughly comparable to that paid by similarly earning individuals.

 

[usmbguest5318]

There is no basis for thinking that is at all the behavior that we would observe. If the rate is 15%, companies will seek to "shelter" it to avoid paying 15% and instead pay at a lower rate, or not pay any income tax at all. Take the case of Google which "shelters" its earnings in Bermuda, which has a zero percent corporate tax rate.

What on Earth leads you to think that a company would not "shelter" its income and thus pay 15% on its earnings rather than pay no tax at all on them?

Revenues - costs - expenses = net income.

15% of EBITDA should be taxed.

I'm fine with that, provided it's EBITDA as reported in the company's 10K. And yes, that would solve the "sheltering" problem because the sums reported in the consolidated statement of income are global sums.

See that. We agree.

Apple's EBITDA for 2016 was about $70 B.

15% of that would be $10.5 billion,

Seems reasonable to me.

See that. We agree.

Yes, we now do.

Whether we did before you added a degree of specificity is unknown to me for it may be that you earlier had in mind what you subsequently clarified. Regardless, we do now concur on an solution approach to eliminating the "sheltering" problem/loophole.

Absolutely. That's the whole thing. That's why I prefer flat taxes.

Just like if you and I buy bubble gum at the same store, we will pay the same tax.

Personal income tax should be done the same way.

We are way over taxed.

We are taxed when we earn money. We are taxed when we invest. We are taxed when we save. We are taxed when we spend. Companies pay tax on the money we give them for their products and services. Obama took away or lowered MANY deductions. (Medical expense deductions now have to be 10% of your AGI, it was 7.5%. That's just one example)

About 40% of those taxes for the FED go to entitlements.

That's why I prefer flat taxes.

Well, the matter of a flat tax vs. graduated tax rates is a totally different thing. I am not in favor of flat taxes for individuals. I can acquiesce to them for corporations, but I'd as well prefer graduated rates for corporations.

 

[ColonelAngus]

Revenues will go up for many companies that currently seek tax shelters.

If the rate was a flat 15%, there would be no need to shelter. It would also allow companies to reinvest in people and expand capacities.

35% of $0 = $0
15% of $1 = 15 cents.

If the rate was a flat 15%, there would be no need to shelter.

There is no basis for thinking that is at all the behavior that we would observe. If the rate is 15%, companies will seek to "shelter" it to avoid paying 15% and instead pay at a lower rate, or not pay any income tax at all. Take the case of Google which "shelters" its earnings in Bermuda, which has a zero percent corporate tax rate.

What on Earth leads you to think that a company would not "shelter" its income and thus pay 15% on its earnings rather than pay no tax at all on them?

Revenues - costs - expenses = net income.

15% of EBITDA should be taxed.

I'm fine with that, provided it's EBITDA as reported in the company's 10K. And yes, that would solve the "sheltering" problem because the sums reported in the consolidated statement of income are global sums.

See that. We agree.

Apple's EBITDA for 2016 was about $70 B.

15% of that would be $10.5 billion,

Seems reasonable to me.

Apple's EBITDA for 2016 was about $70 B.

15% of that would be $10.5 billion, Seems reasonable to me.

In all honestly, the specific tax rate and resulting sums paid from applying that rate to income (EBITDA) isn't something over which I'm all that fussed. So long as the totality of earnings are "captured" and the tax rate applied to them, I'm good. You an others can "carry on" about the rate and sums collected/paid.

FWIW, however, yes, 15% seems like a reasonable tax rate to me, but then so does 10%, 20% or even 25% because the effective rate of only a relatively few individuals exceeds 25%; thus it's seems appropriate that corporations should, seeing as they have "person status" in law, pay at a rate roughly comparable to that paid by similarly earning individuals.

I feel you.

When you add up all the taxes paid, many individuals and corporations pay over 50% to Fed, state, and local governments.

Property taxes, state sales tax, fees and taxes associated with driving or anything else. Local municipalities tax for many things. I love when they call them "FEES" instead of taxes. Like it makes a difference to those paying.

 

[ColonelAngus]

Revenues - costs - expenses = net income.

15% of EBITDA should be taxed.

I'm fine with that, provided it's EBITDA as reported in the company's 10K. And yes, that would solve the "sheltering" problem because the sums reported in the consolidated statement of income are global sums.

See that. We agree.

Apple's EBITDA for 2016 was about $70 B.

15% of that would be $10.5 billion,

Seems reasonable to me.

See that. We agree.

Yes, we now do.

Whether we did before you added a degree of specificity is unknown to me for it may be that you earlier had in mind what you subsequently clarified. Regardless, we do now concur on an solution approach to eliminating the "sheltering" problem/loophole.

Absolutely. That's the whole thing. That's why I prefer flat taxes.

Just like if you and I buy bubble gum at the same store, we will pay the same tax.

Personal income tax should be done the same way.

We are way over taxed.

We are taxed when we earn money. We are taxed when we invest. We are taxed when we save. We are taxed when we spend. Companies pay tax on the money we give them for their products and services. Obama took away or lowered MANY deductions. (Medical expense deductions now have to be 10% of your AGI, it was 7.5%. That's just one example)

About 40% of those taxes for the FED go to entitlements.

That's why I prefer flat taxes.

Well, the matter of a flat tax vs. graduated tax rates is a totally different thing. I am not in favor of flat taxes for individuals. I can acquiesce to them for corporations, but I'd as well prefer graduated rates for corporations.

I want a flat tax system so we can take out all the bullshit waste of time and money in preparing taxes.

Just like buying bubble gum. People shouldn't be taxed at different rates for buying bubble gum from the same store.

 

[August West]

Make all earnings taxable. Overseas and here at home. Earnings held overseas taxed at a much higher rate.

That's a great way to attract foreign investment

Mexico is paying for the wall. How much more foreign investment do we need? They are paying aren`t they?

 

[ColonelAngus]

Make all earnings taxable. Overseas and here at home. Earnings held overseas taxed at a much higher rate.

That's a great way to attract foreign investment

Mexico is paying for the wall. How much more foreign investment do we need? They are paying aren`t they?

There will be one hell of a lot less money going back to Mexico. That is helping pay for it.

Snowflakes should just think of building the wall as shovel ready government jobs.

 

[Faun]

Nope, that plan is working as designed. Want your money here? Pay your taxes on it. Why should they be allowed to avoid paying tax on their income but others, like myself, cannot?

Well you're sure teaching those rich people a lesson. In the mean time they just keep the money over seas. You're showing them though, keep up the good work.

Just a thought though. Maybe you're paying too much or too little in taxes? I mean if you think you deserve 50% or whatever amount of their money to go to the government how much of yours should go there? Are you willing to match what they pay?

It's not about teaching them a lesson. It's about paying taxes. If they bring their money back here, they pay the taxes on that money. No one else gets a break on their taxes where they can avoid paying much of the taxes they owe. Neither should anyone doing business overseas.

Why shouldn't an American company build and sell their products in a foreign country?

What?...Are you seriously suggesting that taxes should be assessed and paid on wished for events rather than actual events? (the relevant event being earning money in the U.S. or earning it elsewhere and bringing it to the U.S.) If so, I'm fairly certain that under such a model, everyone will wish to earn nothing.

You have that backwards. The actual event which is taxable is bringing their money back into the US. That's what I'm saying they should pay taxes on.

I don't have what you proposed backwards at all. Wishing to bring money, earnings, to the U.S. and actually bringing them to the U.S. are not the same things.

I didn't say they shouldn't. What I did say is that they should pay the taxes on profit they wish to bring back into the U.S., per current U.S. tax laws.

Your confusion persists. I didn't say I wish they would bring their money back nor did I say I wish they be taxed for bringing their money back. Is said they have the choice whether or not to bring their money back. If they wish to bring their money back, they should be taxed in accordance with existing tax laws.

 

[usmbguest5318]

There is no basis for thinking that is at all the behavior that we would observe. If the rate is 15%, companies will seek to "shelter" it to avoid paying 15% and instead pay at a lower rate, or not pay any income tax at all. Take the case of Google which "shelters" its earnings in Bermuda, which has a zero percent corporate tax rate.

What on Earth leads you to think that a company would not "shelter" its income and thus pay 15% on its earnings rather than pay no tax at all on them?

Revenues - costs - expenses = net income.

15% of EBITDA should be taxed.

I'm fine with that, provided it's EBITDA as reported in the company's 10K. And yes, that would solve the "sheltering" problem because the sums reported in the consolidated statement of income are global sums.

See that. We agree.

Apple's EBITDA for 2016 was about $70 B.

15% of that would be $10.5 billion,

Seems reasonable to me.

Apple's EBITDA for 2016 was about $70 B.

15% of that would be $10.5 billion, Seems reasonable to me.

In all honestly, the specific tax rate and resulting sums paid from applying that rate to income (EBITDA) isn't something over which I'm all that fussed. So long as the totality of earnings are "captured" and the tax rate applied to them, I'm good. You an others can "carry on" about the rate and sums collected/paid.

FWIW, however, yes, 15% seems like a reasonable tax rate to me, but then so does 10%, 20% or even 25% because the effective rate of only a relatively few individuals exceeds 25%; thus it's seems appropriate that corporations should, seeing as they have "person status" in law, pay at a rate roughly comparable to that paid by similarly earning individuals.

I feel you.

When you add up all the taxes paid, many individuals and corporations pay over 50% to Fed, state, and local governments.

Property taxes, state sales tax, fees and taxes associated with driving or anything else. Local municipalities tax for many things. I love when they call them "FEES" instead of taxes. Like it makes a difference to those paying.

When you add up all the taxes paid, many individuals and corporations pay over 50% to Fed, state, and local governments.

I have seen no evidence that is so. Indeed, what I've seen indicates nothing remotely close to that is so. I will agree that "many" individuals/entities may pay more, but only because the U.S. population and quantity of companies are large enough for even a small percentage of the totality that experience a total effective tax rate at 50% (or anything over 40%, for that matter) may still be a "big number." I find it very hard to believe that three quarters or more, or even most (>50%), of country's individuals, or the same share of companies, realize an total effective tax rate of 50%. After all, some number lower than or near a million people earn enough to even be initially subject to (based on gross income) the top marginal rates. (See also: Tax Brackets in 2017 - Tax Foundation)

So, yes, there may be hundreds of thousands of folks who do pay something around 33% or more in total tax, and, yes, "hundreds of thousands" qualifies in my book as "many." Am I particularly concerned, from a tax equity standpoint, that such people may have a total tax burden at 50% or so? No. And I say that as one of those people and with regard to my own circumstances. (FWIW, my total effective tax rate isn't anything close to 50%; it's not even close to 40%.)

• The Best And Worst States For Taxes In 2016 -- The information here reflects effective rather than marginal rates
  
• Effective tax rates paid (on average) by state -- The linked page has a table which is easier to read than the same information which, at the prior site, is presented in "slides." The narrative content at the prior site is better by far.
• Average individual effective federal tax rates by income bracket -- I realize these are just federal taxes (income and payroll), but looking that them, it's plain to see that there's a long way to go to get to "most" people paying at an effective total tax rate of 50%.
• Average effective corporate tax rates -- Again, this is re: federal taxes, but the same reasoning caveat applies.

I'm not of a mind that no company or individual pays at such a high total tax rate. It's that not enough, as a percentage of the respective populations, do; thus I don't see fixing that problem as a priority, or even something worth worrying over or fixing. I think that such individuals/entities can, like I and other relatively high earners do, fix the problem on their own with some competent tax planning.

Like it makes a difference to those paying.

I agree that whether the sum is deemed a fee or a tax doesn't really matter in the scheme of summing up one's non-discretionary disbursements to governments. That said, a fee is distinguished from a tax by the frequency of its assessment and whether it's absolutely avoidable. For instance, one can avoid any registration fee by not engaging in/performing the activity that triggers one's having to pay the fee. A fine one pays for speeding is a fee, as is the court cost paid to contest the ticket, and yes, the money is paid to a government. Does that make the sums be taxes? No.

 

[ColonelAngus]

Revenues - costs - expenses = net income.

15% of EBITDA should be taxed.

I'm fine with that, provided it's EBITDA as reported in the company's 10K. And yes, that would solve the "sheltering" problem because the sums reported in the consolidated statement of income are global sums.

See that. We agree.

Apple's EBITDA for 2016 was about $70 B.

15% of that would be $10.5 billion,

Seems reasonable to me.

Apple's EBITDA for 2016 was about $70 B.

15% of that would be $10.5 billion, Seems reasonable to me.

In all honestly, the specific tax rate and resulting sums paid from applying that rate to income (EBITDA) isn't something over which I'm all that fussed. So long as the totality of earnings are "captured" and the tax rate applied to them, I'm good. You an others can "carry on" about the rate and sums collected/paid.

FWIW, however, yes, 15% seems like a reasonable tax rate to me, but then so does 10%, 20% or even 25% because the effective rate of only a relatively few individuals exceeds 25%; thus it's seems appropriate that corporations should, seeing as they have "person status" in law, pay at a rate roughly comparable to that paid by similarly earning individuals.

I feel you.

When you add up all the taxes paid, many individuals and corporations pay over 50% to Fed, state, and local governments.

Property taxes, state sales tax, fees and taxes associated with driving or anything else. Local municipalities tax for many things. I love when they call them "FEES" instead of taxes. Like it makes a difference to those paying.

When you add up all the taxes paid, many individuals and corporations pay over 50% to Fed, state, and local governments.

I have seen no evidence that is so. Indeed, what I've seen indicates nothing remotely close to that is so. I will agree that "many" individuals/entities may pay more, but only because the U.S. population and quantity of companies are large enough for even a small percentage of the totality that experience a total effective tax rate at 50% (or anything over 40%, for that matter) may still be a "big number." I find it very hard to believe that three quarters or more, or even most (>50%), of country's individuals, or the same share of companies, realize an total effective tax rate of 50%. After all, some number lower than or near a million people earn enough to even be initially subject to (based on gross income) the top marginal rates. (See also: Tax Brackets in 2017 - Tax Foundation)

So, yes, there may be hundreds of thousands of folks who do pay something around 33% or more in total tax, and, yes, "hundreds of thousands" qualifies in my book as "many." Am I particularly concerned, from a tax equity standpoint, that such people may have a total tax burden at 50% or so? No. And I say that as one of those people and with regard to my own circumstances. (FWIW, my total effective tax rate isn't anything close to 50%; it's not even close to 40%.)

• The Best And Worst States For Taxes In 2016 -- The information here reflects effective rather than marginal rates
  
• Effective tax rates paid (on average) by state -- The linked page has a table which is easier to read than the same information which, at the prior site, is presented in "slides." The narrative content at the prior site is better by far.
• Average individual effective federal tax rates by income bracket -- I realize these are just federal taxes (income and payroll), but looking that them, it's plain to see that there's a long way to go to get to "most" people paying at an effective total tax rate of 50%.
• Average effective corporate tax rates -- Again, this is re: federal taxes, but the same reasoning caveat applies.

I'm not of a mind that no company or individual pays at such a high total tax rate. It's that not enough, as a percentage of the respective populations, do; thus I don't see fixing that problem as a priority, or even something worth worrying over or fixing. I think that such individuals/entities can, like I and other relatively high earners do, fix the problem on their own with some competent tax planning.

Like it makes a difference to those paying.

I agree that whether the sum is deemed a fee or a tax doesn't really matter in the scheme of summing up one's non-discretionary disbursements to governments. That said, a fee is distinguished from a tax by the frequency of its assessment and whether it's absolutely avoidable. For instance, one can avoid any registration fee by not engaging in/performing the activity that triggers one's having to pay the fee. A fine one pays for speeding is a fee, as is the court cost paid to contest the ticket, and yes, the money is paid to a government. Does that make the sums be taxes? No.

Anyone living in NYC would disagree.

 

[usmbguest5318]

Nope, that plan is working as designed. Want your money here? Pay your taxes on it. Why should they be allowed to avoid paying tax on their income but others, like myself, cannot?

Well you're sure teaching those rich people a lesson. In the mean time they just keep the money over seas. You're showing them though, keep up the good work.

Just a thought though. Maybe you're paying too much or too little in taxes? I mean if you think you deserve 50% or whatever amount of their money to go to the government how much of yours should go there? Are you willing to match what they pay?

It's not about teaching them a lesson. It's about paying taxes. If they bring their money back here, they pay the taxes on that money. No one else gets a break on their taxes where they can avoid paying much of the taxes they owe. Neither should anyone doing business overseas.

Why shouldn't an American company build and sell their products in a foreign country?

What?...Are you seriously suggesting that taxes should be assessed and paid on wished for events rather than actual events? (the relevant event being earning money in the U.S. or earning it elsewhere and bringing it to the U.S.) If so, I'm fairly certain that under such a model, everyone will wish to earn nothing.

You have that backwards. The actual event which is taxable is bringing their money back into the US. That's what I'm saying they should pay taxes on.

I don't have what you proposed backwards at all. Wishing to bring money, earnings, to the U.S. and actually bringing them to the U.S. are not the same things.

I didn't say they shouldn't. What I did say is that they should pay the taxes on profit they wish to bring back into the U.S., per current U.S. tax laws.

Your confusion persists. I didn't say I wish they would bring their money back nor did I say I wish they be taxed for bringing their money back. Is said they have the choice whether or not to bring their money back. If they wish to bring their money back, they should be taxed in accordance with existing tax laws.

I didn't say I wish they would bring their money back nor did I say I wish they be taxed for bringing their money back.

I didn't and don't think you said those things. I think what you said and wrote is that people/companies should "pay taxes on the profit they wish to bring back to the U.S." I maintain that wishing to bring money back to the U.S. is not something that should be taxed.

Furthermore, what should be and is taxed is earning money, not transporting (bringing it) anywhere.

The actual event which is taxable is bringing their money back into the US. That's what I'm saying they should pay taxes on.

The taxable event is not, never to my knowledge has been, and likely never will be the transport of money into or out of a nation. It is the earning of the money, as contrasted with mere receipt of money, and the money's status as income that gives rise to the money's being subject to tax, hence the term "income tax." There is such a thing as a "gross receipts" tax, and that type of tax does not distinguish among the natures of monies received and that are thus subject to taxation.