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The earnings of corporations are eventually taxed. I don't see why they should be doubly taxed. If I go and perform a job, I will pay income taxes on it. If I
by morgante 11y ago
The earnings of corporations are eventually taxed.
I don't see why they should be doubly taxed. If I go and perform a job, I will pay income taxes on it. If I go and hire a bunch of people, form a corporation, and perform a job, we will pay both corporate taxes and income taxes.
That doesn't make sense to me and I can understand why companies go to great lengths to avoid it.
- imgabe 11y agoThe portion that is subject to income taxes (employee salaries) is not subject to corporate taxes. Salaries are a cost for the company and only the profits are subject to corporate income tax.
- morgante 11y agoI misspoke by attributing the double taxation on earnings to "income taxes." You're right that the portion subject to income taxes is a cost, not profit. I meant the taxation of dividends, which are doubly taxed.
- newman314 11y agoCorporate profits are left overseas and not taxed/taxed at a very low level. You see this with Apple, Google, Medtronic etc. Taxation of dividends is double taxed if you could once to the corporation and once to the individual. Avoidance of taxation of dividends (which only a subset of companies do) is not why these corporations go to such lengths to avoid paying taxes. They do it because they don't want their profits taxed. That's my beef.