3 ms·
Ya, that is a real problem with just eliminating it. I think there are probably ways of working around that problem, but they may be messy. I don't think just
by darawk 11y ago
Ya, that is a real problem with just eliminating it. I think there are probably ways of working around that problem, but they may be messy.
I don't think just giving shareholders a credit is sufficient though. Fundamentally the problem with the corporate income tax is that it takes away productive capital from companies - capital they could be using to hire more people, invest in R&D, etc.
The reason we have a corporate income tax is that people think corporations = wealthy, and they want to tax the wealthy more. This is a fine goal, but it'd be better served by doing just that: taxing the wealthy more, rather than taking what would have been productive capital away from private enterprises.
- danieltillett 11y agoThe problem is if you don’t get the corporate and personal income taxes approximately equal is you end up with people basically running everything through a company. The nice thing about franking credits is they work like a LLC in making corporate income tax a pass-through structure to the shareholders. At the moment US companies don’t seem to be constrained by lack of capital, more a lack of profitable investment opportunities due to weak consumer demand. I ams sure making the 0.01% richer will help solve this.