Corporate and business taxes are just plain wrong!!!!

[skarke]

Here's another Skarke rant.

I think that taxing corporations and businesses is about the stupidest thing that a government can do.  Heres why:

1.  Every dollar of tax burden placed on business is passed on to the end consumer in increased cost of product, period, the end, inarguable.

2.  Corporations and businesses will produce goods in the most cost effective way, or get beat by those who do. Industry will set up shop where costs are lowest.  If 1 government pops a corporation with a 40% tax rate on profits, and the next has none....do the math.  Remember the giant sucking sound???

3.  Progressive taxes and corporate taxes punish success, and make it easier for the loafers in society to pass the burden of their laziness to a shrinking pool of net tax payers, exacerbating the problem.  Most people in the US are net tax users because of entitlements.  They are literally voting themselves money from the public coffers by forcing our politicians to buy their votes through entitlement spending, creating a vicious and anticapitalist cycle that is destroying the fabric of our economy.  Anybody heard of the "Millionaires Tax"?  Look it up, and while you are at it, see where the millionaires go when a State imposes such tax.

4.  I could go on, but I'll close with this:  Accepting charity when it isn't necessary is immoral.  We have several generations of Americans now that believe receiving Welfare, WIC, etc. is perfectly fine, even when they wouldn't have to if they just took a little initiative.  Califorina and New York spend several fold more than Texas on "social services".  What is their relative poverty rates?  About the same.  Hummm, seems like money well spent to me.

People need to just get off of their big, fat posteriors and pick up a freaking broom.  Start by sweeping, then managing the sweepers, then owning a sweeping company, etc.  Geeze.

 

[cwall]

I agree with you 100%.  Corporations may write a check for taxes, but, since taxes are a cost of doing business, that cost is passed on to the consumer as higher prices.  I call corporate taxes "idiot taxes", because, if you think corporations pay, you are one.  However, the government tax our domestic businesses with rates higher than any in the industrialized world, because they have figured out that most people are idiots and will not figure out just how much tax we all pay when the tax is disguised as higher prices.  You are also correct that businesses relocate to areas where their products can be manufactured at a competitive cost ie lower taxes and all the rest.  I just wonder how many plants have relocated to China just to remain in business.

[magooch]

I might agree with the concept of business taxes being a negative thing, but it isn't quite that simple.  Sometimes it is desirable to influence business decisions; such as: capital expenditures to upgrade production efficiency, pollution abatement, location of fascilities and so on.  Without the tax relief, or exception, government has scant tools to exert pressure on business.

I'm not saying I agree with government having that much influence over private enterprise, but sometimes it just has to work that way.  In fact I would rather that if government must pressure business at times, I would rather it be by incentive rather than by edict.

[Matt]

Funny thing.... That is one of the only taxes set up by the Constitution... hmmm... so you folks don't like the Constitution... got it... It all makes much more sense now...

Matt

[Cabin4]

Article 1 section 8 of the constitution gives power to congress to institute taxes. Now, are we and business taxed too much, yes. Way to much, which is the engine of power that enables the government (Fed & State level) to grow and become the over powering tyrannical animal we now have. The only problem we have with taxes in this country are we continue to elect represenatives that yes vote spending and more spending which in turn drives up our taxes.

[skarke]

Matt,

Consider this, the 16th Amendment to the US Constitution:

"The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration."

While clearly the Federal Government has Constitutional power to tax income, and magooch is correct that tax incentives to business is an effective steering tool for behavior, is there a better way?  I say yes.

As cwall so perfectly stated,
"Corporations may write a check for taxes, but, since taxes are a cost of doing business, that cost is passed on to the consumer as higher prices."
we're fooling ourselves it we think that we are saving ourselves money by passing the responsibility to our suppliers.

Tax consumption, not production or income.  It incentivizes saving, makes the cost of production in the US cheap and competitive outside the US, and likely reverses the tidal flow of lost manufacturing sector jobs being lost to countries that have lower costs of doing business.

Look at it this way, if a corporation could rid itself of exhorbitant taxes, they could hire and pay more peope to work, while still staying cost neutral.


 

[skarke]

TM7, I agree with what you say.  Maybe we should just have all taxes paid by US corporations, then we wouldn't have to pay any personal tax .  I use absurdity to illustrate my point.  We the consumers pay all costs associated with taxation, either by proxy trough corporate taxes resulting in higher costs of products, or directly through payroll and sales taxes.

I've not heard that 4/5ths of the fortune 500 companies pay no tax.  I work for a Fortune 40 company, and our taxes are freaking ridiculous.

Also, next time I am around shopping, I'm going to walk down the strip centers in my town and ask as many owners as I can what their best guess is on what taxes they pay annually.  Except for the ones going broke, I'm sure that I'll hear some gnashing of teeth.

We are too heavily taxed because we allow it by attempting to push the burden upon "the other guy".  When we all realize that all government costs eventually fall upon We the People, we'll begin figuring it out.

You are correct on the NWO progressives, but tarriffs have never proven effective.  I really, truly wish they were, because we'd only be trading with countries similar to ours.  That is the conundrum, if we become protectionist, we will foster inefficiencies in our economy and make things even more currupt and costly.

[Matt]

skarke, I understand where you are coming from but as to the 16th there have been 2 or 3 SCOTUS rulings that have upheld that if you were not required to pay taxes before the 16th then you are not required to pay them after. The reason being is that the Constitution defines "income" as "Profit or Gains from a Corporation" and not "Personal Wages or Earnings". Also I have a huge problem with the way the "Federal Income Tax Revenue" is used. Every single dime of it goes to one place and that is the Federal Reserve which is not in any way a Government entity. In fact it is a PRIVATELY OWN FOREIGN BANK! and I don't know about you guys but I am about sick of my tax dollars going to a foreign bank to further the NWO agenda.

I do not have a problem with most sales taxes, some property taxes, fuel taxes or many of the other taxes that we pay even though many of them are unconstitutional. They are a means for the local and state governments to operate although if most would stop the entitlements and handouts the required funding could be much less. I am also for getting the Federal Government out of the states business and for them to go back to what it was meant for... which is very damn little...

Matt

[Dixie Dude]

Many things you buy are taxed multiple times.  For instance.  Drill a natural gas well, sell the gas to a pipeline transportation company, driller pays income tax.
Pipeline transportation company sells to a state or local distribution company.  Pipeline transportation company pays income tax.
Distribution company sells to individuals, distribution company pays an income tax, and in Alabama a 4% sales tax which is all passed on to the consumer. 
Oil and gasoline are the same way.

The cost of gasoline is about 25 cents on the dollar.  The 75 cents is various taxes up and down the line. 

All taxes are ultimately paid for by the consumer. 

I think a flat income tax, not the progressive type we have, with no deductions is one way to fix the problem.

Another is a national sales tax on everything.  Rich and corporations would always pay more because they buy more. 

Something I heard the other day.  Federal employees across the board get about 30% more pay and benefits than private jobs doing the same thing.  If you made every federal employee take a 20% pay cut, from the president on down, the federal government would save about $500 million dollars a year.  Might even balance the budget.  Make every department take a 5 or 10% cut in funding, and save a bundle more.  Federal spending is out of control. 

[wreckhog]

High corporate taxes are an incentive for corps to spend their money instead of paying taxes on it. That is why Wall Street can pay out 1/3 of their profit in bonuses. Corps spending money on cars, buildings, services, etc is what drives the economy. IF they were allowed to keep the money, they would not spend it, so the man in the street would not get it in the form of a salary as an employee of some little company that provided some unnecessary service to the corp.

[blind ear]

1.3 million coorps, 200 million potential + - voters, how do the voters end up in the position they/we are in?
Hummmmmmmm?

[Cabin4]

TM7,

No profit, nothing to tax. The US has some of the highest corp tax rates in the civilized world. Corporations are incented, to show as much profit as possible under non-US subsidiaries. Perfectly acceptable and perfectly normal. If you sell a product in a foreign country, they are paying tax in that country. The tax structure has corporations doing whatever they can to perform sale transactions under their foreign entities even if it is to another US corporation/business. As an example, if US corp A sells product to US corp B in say Spain. Even if the goods are sitting in a warhouse in the US, US corp A ships the goods under  Incoterm DDU or DDP to US corp B's subsidiary in Spain. The sale is registered in Spain and the profits on the sale are paid in Spain under US corp A's Spanish sub. Pefectly legal and the tax structure is designed to support this. The profit can only be taxed once. In any case, if you doing business in US and even if you evade paying any federal tax on your profit, your employing people and they are paying income tax and the companies you buy from are paying tax on the goods and services they sell that coorporation.

[sagegrouse715]

Wait now, correct me if I am wrong, but haven't corporations accepted government assistance a few times in our history. And didn't a recent Supreme Court ruling say that corporations have "free speech"  rights in donating money.

If my recollection is true, than I see no problem with corporate taxation.

[skarke]

...corps can only pass a portion of taxes on to consumers lest they price out of the market and drive consumers elsewhere or create non interest.

Among foreign corporations, a slightly higher percentage, 68 percent, did not pay taxes during the period covered – compared with 66 percent for United States corporations. Even with these numbers, corporate tax receipts have risen sharply as a percentage of federal revenue in recent years (to me, this seems like about the same time that the giant sucking sound was the greatest.  Why get hammered by US taxes when you are trying to produce a product to sell in Europe?)The G.A.O. study was done at the request of two Democratic senators, Carl Levin of Michigan and Byron L. Dorgan of North Dakota.

Senator Levin said in written remarks on Tuesday that “this report makes clear that too many corporations are using tax trickery to send their profits overseas and avoid paying their fair share in the United States.” (Fair Share.  Fair Share? 50% of Americans pay no Federal Income Tax. 70% are net tax users.  How fair is that?  I can guarantee that, until we fix punitive tax policy, frivolous tort exposure, hyper-regulation and frankly, excessive labor costs (including managerial labor), businesses will continue to leave.  That is fact, and we can watch it every day by just watching the news.)

But the G.A.O. said that it did not have enough data to address the role of what some policy experts say is a crucial factor in profits sent overseas.

That factor, known as transfer pricing, involves corporations’ charging their overseas subsidiaries lower prices for goods and services, a common move that lowers a corporation’s tax bill. A number of corporations are in transfer-pricing disputes with the Internal Revenue Service.  (If they had no tax exposure in the US, it would be here that the transer cost of goods would be recorded, and benefited from.  Entities and individuals will always use the most favorable accounting policy to maximize competitive advantage, that's just business)

Either way, the nearly 1,000 largest United States corporations were more likely than smaller ones to pay taxes.

In 2005, one in four large United States corporations paid no taxes on revenue of $1.1 trillion, compared with 66 percent in the overall pool. Large corporations are those with at least $250 million in assets or annual sales of at least $50 million.

Joshua Barro, a staff economist at the Tax Foundation, a conservative research group, told The New York Times that the largest corporations represented only 1 percent of the total number of corporations but more than 90 percent of all corporate assets.

The vast majority of the large corporations that did not pay taxes had net losses, he said, and thus no income on which to pay taxes. “The notion that there is a large pool of untaxed corporate profits is incorrect.”  I couldn't have said it better Joshua, the US was in the midst of a massive economic meltdown from the dotcom fiasco.  You don't pay taxes when you lose money, unless you are the oil industry.

In 2004, a G.A.O. study said that 7 in 10 of all foreign corporations doing business in the United States, or foreign-controlled corporations, paid no taxes from 1996 through 2000, compared with 6 in 10 United States corporations.

~~~~~~~~~~~~~~~~~~

Good points wreckhog. Plus fact that corps reap huge benefits from public sponsored and funded research. Fact is you can only take tax from about 1/3 of the serf, err citizens, then they start to rebel. Since 90% of the country's wealth is held by about 5% of the poupulation and corps and foundations the gov may actually have no choice but to tax these entities if they want to carry on their wars. Also, corps are the entities that most benefit from wars; certainly not common citizens... Like Dillinger said he robbed banks because that was where the money was.


...fyi...TM7

[torpedoman]

 Giving money to the government is like giving your teen ager a fifth of whiskey and the car keys.

[skarke]

My point, by the way, remains the same.  EVERY DOLLAR (including tax) of cost of production is covered by the consumer.  It is such a simple concept, common sense, inarguable.  So, like I said, if it makes everybody feel better to have a corporation or small businessman write the check, cool.  Let's designate them the sole taxable entity in the US.  We'll still get soaked just the same through the price of goods until we reign in entitlement spending.

[nomosendero]

TM7,

No profit, nothing to tax. The US has some of the highest corp tax rates in the civilized world. Corporations are incented, to show as much profit as possible under non-US subsidiaries. Perfectly acceptable and perfectly normal. If you sell a product in a foreign country, they are paying tax in that country. The tax structure has corporations doing whatever they can to perform sale transactions under their foreign entities even if it is to another US corporation/business. As an example, if US corp A sells product to US corp B in say Spain. Even if the goods are sitting in a warhouse in the US, US corp A ships the goods under  Incoterm DDU or DDP to US corp B's subsidiary in Spain. The sale is registered in Spain and the profits on the sale are paid in Spain under US corp A's Spanish sub. Pefectly legal and the tax structure is designed to support this. The profit can only be taxed once. In any case, if you doing business in US and even if you evade paying any federal tax on your profit, your employing people and they are paying income tax and the companies you buy from are paying tax on the goods and services they sell that coorporation.

There you go using logic again.

[nomosendero]

My point, by the way, remains the same.  EVERY DOLLAR (including tax) of cost of production is covered by the consumer.  It is such a simple concept, common sense, inarguable.  So, like I said, if it makes everybody feel better to have a corporation or small businessman write the check, cool.  Let's designate them the sole taxable entity in the US.  We'll still get soaked just the same through the price of goods until we reign in entitlement spending.

Yes, skarke indeed!
 
Yes, we have some of the largest Corp. taxes on the planet. Of course we could look back at the days when our Corporations were taxed less & compare the overall health of Corporations, the overall std. of living for Individuals at the time & the overall financial Health/Dept of our Nation at that time & compare with now. Wait a minuter, why are we all worse off now!  But I guess we are saying that Corp. need to pay more taxes even though all facets of our economy, including Corporations are going down the toilet.
And most of the slightly over 50% of Citizens that actually pay taxes now are paying too much, I guess we should raise thart too!

And give it to the Gov, because they handle the money so well.  I have to go with Torpedoman's statement on that one.

It is true as someone said that you can't just pass on the extra expenses in all cases because of competition. But the untold side of that story is these folks who get squeezed to the point nothing is left then causes many of them to leave the country to manufacture his product. Progressives would say this doesn't happen either, but I could give a long list of customers who had to do just that.

[Oldshooter]

Lets make it simple for some that dont get it!

You tax the bread man for his profits for making bread, you pay more for the bread. Its all passed on to the consumer! So like was said before, if it makes you feel better for corporations to pay higher taxes, ok just pay his taxes when you buy the bread.

It aint the taxes that are killing us as much as the spending, you'll never get taxed enough if the spending keeps increasing. It dont matter where the taxes come from or what indirect rout they take. "WE" are gonna pay em, so "WE" need to make the spending stop!

[billy_56081]

Yeah it's pretty simple, if you tax a coprotation, they will add the cost of the tax into the end price of the product making it and YOU the customer pay the tax. To me it is the same as fining a corporation for some misdeed. The customer ends up paying that fine. Put the ones who do wrong in jail and save the customer some money.

[skarke]

Yeah it's pretty simple, if you tax a coprotation, they will add the cost of the tax into the end price of the product making it and YOU the customer pay the tax. To me it is the same as fining a corporation for some misdeed. The customer ends up paying that fine. Put the ones who do wrong in jail and save the customer some money.

Amen

[cwall]

Amen + 1

[blind ear]

    1. lobbiest
    2. coorporations with the rights of citizens (which the citizens are loseing)
    3. unlimited coorporate campaign donations, (coorporations get something when they spend thier money)
    4. a congress that is bought and paid for, now more than ever

    The American voter will surely end up in a better position now.

     Fills you with confidence doesn't it.       

     eddie

[wreckhog]

What is profit? It is what you have left at the end of the year you made a $billion las year and spent $billion on expenses like salary, what is your profit? Zero. Guess what, all those people that received those salaries paid taxes.

[Dixie Dude]

I have several contractors that I have to keep tabs on working for my corporation.  These small corparations make a profit after salaries during the year.  If they have extra money at the end of the year, they pay their workers bonuses, and they might buy some new equipment as corporate expenses.  Thus less profit, but they buy things like backhoes, trackhoes, ditching machines, trucks, etc.  Their employees (these are small companies with less than 10 people total including the owners), like their bonuses.  All extra cash less expenses is taxed heavily.  So, they spend it.  It actually helps the economy when they buy equipment and pay bonuses.  Now, if we had a national sales tax instead of 30+% income tax, they would pay tax on the $100,000 pieces of equipment they buy.   

[SHOOTALL]

I agree with this but how else would they get around double taxiation and excessive tax ?

[Oldshooter]

Although I totally agree with a national sales tax instead of an income tax. You will still pay for the sales tax of a retailer or service provider in product costs.

The beautiful thing about a national sales tax would be the fact that When you buy something you pay the tax. So even Drug dealers and others that dont report earnings would pay taxes. If you buy you pay if you have it and spend it you pay, if you have it and save it you pay less. Works for me!

[Dixie Dude]

With a national sales tax, they can leave off groceries and medicines, or even medical expenses.  Tax everything else. 

[skarke]

Geeze, I love this stuff!!!!!!!!  So many good points on all sides!!!!!!!!

I don't have the answers, only speculation.  TM7, you are right, eddie, billy, sage, cabin, all good points.

However, when they make me Dictator, the Federal government will shrink dramatically.  You'd better really need welfare to get welfare.  Drop out of school?  Guess what, you'd better get a GED, or forget government assistance.  In fact, your GED program will be the only thing that I'll pay for.  Defense spending? It is a scary world.  The monetary system?  Have you ever heard of the Gold Standard?  Sue somebody? If the standard of evidence doesn't reach clear and convincing, rather than the preponderance, loser pays.  Act criminally?  There are lots of pot holes to fill, weeds to be plucked from farmland, alarm clocks to learn how to use, and marketable skills to acquire.  You ain't gonna be watching Oprah.  Repeat violent offender?  How's a nice trip to a Caribbean island sound, say, Devil's Island II?

Corporate taxes?  None.  Income taxes? none.  Property taxes? None.  Consumption taxes?  You bet.  Balanced budget mandate? Double down.  Rainy day fund mandate equalling 10% of budget? Triple down.

Figuring out what is necessary vs what is nice for government to do, I'll do first year as a Monarch.

Of course, we live in a Constitutional Representative Republic, so I'm just pontificating.  But the survival of our Constitution depends upon the preservation of our means of economic exchange.  We are currently doing the opposite.

[magooch]

Well, if you really want the dictator gig, you might not have long to wait.  That is the next step in the failure of democracy.  If this universal health care passes, we should be set up for the final demise of our democracy, so get your name on the list.  I would vote for you, but I don't think that is the way a dictator would be selected.