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By that logic we set corporate tax rate to 0 and throw our hands in the air. Having missed out on some percent of corporate tax revenue does not mean to me tha

By that logic we set corporate tax rate to 0 and throw our hands in the air. Having missed out on some percent of corporate tax revenue does not mean to me that our entire regimen is worth discarding, but could be adapted.

harryh 9y ago
That's exactly what we should do. All taxes are taxes on people. Corporate taxes are an inefficient and not especially progressive tax on people. We'd be better off without them.
- existencebox 9y ago
  Convince me, why should I buy that argument? I've not seen any compelling justification that reducing the corporate tax would do anything but create a further deficit which would need to be filled with a much more direct tax on people less able to pay. What precedent is there for this sort of strategy actually showing long term benefit across the broad economic spectrum, and not just to the upper percentile? (This is fantastic, I can't even get 2 seconds into asking for discussion without being in the negative. This is not the HN I normally applaud. I'd hope readers recognize that I'm actually looking to have my opinion changed here and not just spark an unproductive argument, and am saddened that I have to clarify this.)
  - harryh 9y ago
    Yes, if we eliminated corporate taxes we would need to raise individual taxes in order to maintain government revenue. But we could do so in a way that was: A) Far more efficient - The deadweight loss of corporate taxes is higher than individual taxes. Corporate taxes are crazy complicated by necessity and lead to all sorts of crazy behaviors. B) More fair - A millionaire should pay higher taxes on his profits from stock ownership than a middle class person. When a corporation pays its taxes those two people are taxed at the same rate.
    - existencebox 9y ago
      A sister poster suggests offsetting with higher cap gains, which could be a component of what you're suggesting and I could see how that would work as a concept, but I have issue with pragmatism within the US. As far as I understand it, didn't both the prior tax holiday come essentially in isolation of balancing factors, alongside a broader tax plan that de-emphesized the higher tax brackets and cap gains? (and from a brief reading, seems to have added a significant amount to the national debt via lost tax revenue, during a period of drastically increasing inequality) This was my original concern when posting earlier, that I haven't seen a history of positive outcomes, or strategies that offset like you're suggesting.
      - unexpected 9y ago
        Oh I agree with you - the current tax holiday plan is just a dramatic wealth transfer from the rich to the poor. In an increasingly globalized environment, trickle down economic gains are diffused over investors all over the world. The current Republican tax plan has a 1950's era view of the world. With the current proposal, the only way to sustain the middle class is to close our border and become more nativistic - which is what happening.
      - harryh 9y ago
        I agree that a "tax holiday" is a bad plan. I also agree that from a political standpoint my plan might be unworkable. I think it's a good plan from an economic standpoint though.
  - unexpected 9y ago
    I have some thoughts about this. If we think about the strengths of the U.S. economy, it's the transparency, rule of law, and easy access to capital that U.S. companies have. We should encourage all companies to be formed here. I would drop corporate taxes as much as possible. Now, let's say we've done this. What next? In this age of the global economy, I think the problem with trickle down economics is that while companies are localized, the trickle down is globalized. Investors from overseas take their gains and re-invest it into their own economies at a much higher rate than the U.S. economy. So, I would tax them on the way out. Make corporate tax rate low, but capital gains higher. This encourages companies to stay here, re-invest their profits here, and investors "pay their fair share" when they take their profits out.
- mdorazio 9y ago
  By law, corporations are people. Why should they be taxed differently than human people? Why not just form a corporation that is in the sole business of making your life better, earn all income through and charge everything through the corporation, and never pay a penny in tax yourself?
  - harryh 9y ago
    > By law, corporations are people. This is a commonly held belief, but it is not true. > Why not just form a corporation... Your idea won't work because a company buying something for an employee (or owner) is considered a taxable benefit to that person just like paying them a salary.
    - toomuchtodo 9y ago
      >> By law, corporations are people. >This is a commonly held belief, but it is not true. "Are corporations people? The U.S. Supreme Court says they are, at least for some purposes. And in the past four years, the high court has dramatically expanded corporate rights. It ruled that corporations have the right to spend money in candidate elections, and that some for-profit corporations may, on religious grounds, refuse to comply with a federal mandate to cover birth control in their employee health plans. These are personal rights accorded to corporations. To many, the concept of corporations as people seems odd, to say the least. But it is not new." http://www.npr.org/2014/07/28/335288388/when-did-companies-become-people-excavating-the-legal-evolution http://www.npr.org/2014/07/28/335288388/when-did-companies-b...
      - harryh 9y ago
        "has some of the rights of people" != "are people" My pet dog does some things that people do. He eats, he walks, he poops. That doesn't mean he's a person.
        mdorazio 9y ago
        You seem to be conflating "person" with "human". The two are entirely separate. And this is where being pedantic is important. For legal purposes on important points like entering contracts, free speech, freedom of religion, being sued, etc. corporations are people. The case law is very clear on this. Can your dog be sued? No. So when we talk about legally bound responsibilities like paying taxes, suddenly making a distinction between corporations and humans with respect to personhood seems really strange.

harryh 9y ago

That's exactly what we should do. All taxes are taxes on people. Corporate taxes are an inefficient and not especially progressive tax on people. We'd be better off without them.

existencebox 9y ago
Convince me, why should I buy that argument? I've not seen any compelling justification that reducing the corporate tax would do anything but create a further deficit which would need to be filled with a much more direct tax on people less able to pay. What precedent is there for this sort of strategy actually showing long term benefit across the broad economic spectrum, and not just to the upper percentile? (This is fantastic, I can't even get 2 seconds into asking for discussion without being in the negative. This is not the HN I normally applaud. I'd hope readers recognize that I'm actually looking to have my opinion changed here and not just spark an unproductive argument, and am saddened that I have to clarify this.)
- harryh 9y ago
  Yes, if we eliminated corporate taxes we would need to raise individual taxes in order to maintain government revenue. But we could do so in a way that was: A) Far more efficient - The deadweight loss of corporate taxes is higher than individual taxes. Corporate taxes are crazy complicated by necessity and lead to all sorts of crazy behaviors. B) More fair - A millionaire should pay higher taxes on his profits from stock ownership than a middle class person. When a corporation pays its taxes those two people are taxed at the same rate.
  - existencebox 9y ago
    A sister poster suggests offsetting with higher cap gains, which could be a component of what you're suggesting and I could see how that would work as a concept, but I have issue with pragmatism within the US. As far as I understand it, didn't both the prior tax holiday come essentially in isolation of balancing factors, alongside a broader tax plan that de-emphesized the higher tax brackets and cap gains? (and from a brief reading, seems to have added a significant amount to the national debt via lost tax revenue, during a period of drastically increasing inequality) This was my original concern when posting earlier, that I haven't seen a history of positive outcomes, or strategies that offset like you're suggesting.
    - unexpected 9y ago
      Oh I agree with you - the current tax holiday plan is just a dramatic wealth transfer from the rich to the poor. In an increasingly globalized environment, trickle down economic gains are diffused over investors all over the world. The current Republican tax plan has a 1950's era view of the world. With the current proposal, the only way to sustain the middle class is to close our border and become more nativistic - which is what happening.
    - harryh 9y ago
      I agree that a "tax holiday" is a bad plan. I also agree that from a political standpoint my plan might be unworkable. I think it's a good plan from an economic standpoint though.
- unexpected 9y ago
  I have some thoughts about this. If we think about the strengths of the U.S. economy, it's the transparency, rule of law, and easy access to capital that U.S. companies have. We should encourage all companies to be formed here. I would drop corporate taxes as much as possible. Now, let's say we've done this. What next? In this age of the global economy, I think the problem with trickle down economics is that while companies are localized, the trickle down is globalized. Investors from overseas take their gains and re-invest it into their own economies at a much higher rate than the U.S. economy. So, I would tax them on the way out. Make corporate tax rate low, but capital gains higher. This encourages companies to stay here, re-invest their profits here, and investors "pay their fair share" when they take their profits out.
mdorazio 9y ago
By law, corporations are people. Why should they be taxed differently than human people? Why not just form a corporation that is in the sole business of making your life better, earn all income through and charge everything through the corporation, and never pay a penny in tax yourself?
- harryh 9y ago
  > By law, corporations are people. This is a commonly held belief, but it is not true. > Why not just form a corporation... Your idea won't work because a company buying something for an employee (or owner) is considered a taxable benefit to that person just like paying them a salary.
  - toomuchtodo 9y ago
    >> By law, corporations are people. >This is a commonly held belief, but it is not true. "Are corporations people? The U.S. Supreme Court says they are, at least for some purposes. And in the past four years, the high court has dramatically expanded corporate rights. It ruled that corporations have the right to spend money in candidate elections, and that some for-profit corporations may, on religious grounds, refuse to comply with a federal mandate to cover birth control in their employee health plans. These are personal rights accorded to corporations. To many, the concept of corporations as people seems odd, to say the least. But it is not new." http://www.npr.org/2014/07/28/335288388/when-did-companies-become-people-excavating-the-legal-evolution http://www.npr.org/2014/07/28/335288388/when-did-companies-b...
    - harryh 9y ago
      "has some of the rights of people" != "are people" My pet dog does some things that people do. He eats, he walks, he poops. That doesn't mean he's a person.
      - mdorazio 9y ago
        You seem to be conflating "person" with "human". The two are entirely separate. And this is where being pedantic is important. For legal purposes on important points like entering contracts, free speech, freedom of religion, being sued, etc. corporations are people. The case law is very clear on this. Can your dog be sued? No. So when we talk about legally bound responsibilities like paying taxes, suddenly making a distinction between corporations and humans with respect to personhood seems really strange.