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"2. Creates an incentive for companies to pay accountants and lawyers a large amount of money to find ways to engage in #1. All of this money is, in economic te
by s73v3r_ 8y ago
"2. Creates an incentive for companies to pay accountants and lawyers a large amount of money to find ways to engage in #1. All of this money is, in economic terms, deadweight loss."
I would argue that is not an issue because that happens anyway. There is not, nor will there ever be a tax point where these huge companies don't attempt to get out of paying taxes.
- darawk 8y agoNot true. Complexity in the tax code incentivizes gaming expenditures. Companies invest in things that generate return. When the gain from investing in accountants exceeds the cost of those accountants and their sheltering strategies, they invest in it. A good tax code makes the gain to be had from loopholes smaller than the cost of implementing those loopholes. This corporate tax rate harmonization was one step among many more that ought to be taken along the path to doing that.