4 ms·

Today we have hyper globalized financial systems and if a country implements taxes like this the big players just move their money elsewhere. This only ends up

Today we have hyper globalized financial systems and if a country implements taxes like this the big players just move their money elsewhere. This only ends up hurting middle class folks who are playing by the books. I think it would make much more sense to have a very simple tax system (a few percent on every capital gain or income, wether corporate or personal) and get rid of every other complexity and loophole. If America had one of the lowest corporate tax rates many companies would locate headquarters here and bring that few percent of billions of dollar we wouldn't have otherwise. I also think we could create a special administrative and economic zone (without minimum wage) in the first 50 miles of southern border and allow anyone to come work there from all over the world. This would create a pathway for people to come here legally and have civic and language classes to help integrate. We could pick the best and brightest from this zone for citizenship which I think is a more fair system. Before you dismiss this idea as colonial consider that this area would have the same human rights and laws as the rest of the US just with low wages, this would be better working conditions than most places on earth with similar wages while also providing a defined channel to gain US citizenship.

dmos62 7y ago
I like your ideas. However, I don't fully follow the the low corporate taxes one though. Is the idea to compete in a race-to-the-bottom with corporate taxes and profit from trickle-down economics? I think the popular critique of trickle-down is fair.
- buboard 7y ago
  Corporation tax does not tax (rich) individuals
- solotronics 7y ago
  It's not a race to the bottom, for a number of reasons America is a good place already for international corporations to have headquarters. We have a strong and mostly fair legal system, and rule of law that many countries do not have. We have a world class workforce. But by having high corporate income tax you are driving away companies that would otherwise HQ here and bring money and taxes. I see benefits and no downsides to making the environment here even more appealing to corportations.
  - dmos62 7y ago
    Race to the bottom was not a clear expression of what I meant. I meant that US would compete with other tax environments for lowest corporate taxes, which would drive down corporate taxes globally. The obvious implication is that the corporations then contribute even less to the governmental budgets. In terms of foreign policy, this has the problem of breaking solidarity with other countries. Actually, it seems that the whole idea is based on competition instead of cooperation, but given US policies today, that would be normal. What I'm wondering is would this pay off to the winner that would attract many corporations, but derive minimal taxes from them. What's the mechanism to profit from their operating within your administrative unit in that case?
    - solotronics 7y ago
      Corporations don't exist in a vacuum, they are organizations of people working and recieving salaries. I would argue that by having corporate headquarters located somewhere you are bringing massive net benefit if you only look at salary. The corporate income tax is just extra that the government can squeeze out of them and its become apparent that the biggest corporations can get out of most of that anyways in the US by careful gaming of the tax code. Thus my proposal to lower the rate to a more realistic amount and simplify the tax code. Amazon paid $0 corporate income tax last year on $11 billion in income, they structure the company around reinvesting all the profit for the exact reason of not paying taxes. 2% flat rate for everyone is much better than 0% for the most cunning.
gota 7y ago
I'll focus on the initial part of your post to point out that you _cannot_ trivially avoid taxes for operating in the largest economy in the world while operating in the largest economy in the world. Sure it's possible under certain aspects (like Facebook et al. paying nearly zero under being "mutlinational" and even that relies on the will of the government to allow it) but that does not apply to the US stock market, does it? Unless someone knows something I don't I can't be convinced financial players would stop trading in the US because of taxes unless they are really, really abusive. Some evasion to other markets, perhaps, but how much "down" to developing nations are large funds willing to go? You can't just seamlessly move the entire thing elsewhere. No other country has the economy and international (military) presence. Do we all agree that makes a difference? I can't see this level of taxation changing things at all
ru999gol 7y ago
Its sort of amazing that anyone can still openly advocate that raising taxes on the rich "only ends up hurting middle class" or for "no minimum wage" slavery, without getting the shit kicked out of them. The really crazy thing is they think they are good people, not at all rotten and viscous as they truly are. The cliff between rich and poor is ever more increasing, and you think giving the rich more is going to stop this, you deserve whatever is coming to you when the poor have reached their limit and come knocking on your door. Maybe at least you will realize, that the poor that is going to kick your head in, is not reading Hacker News.
- seneca 7y ago
  > Its sort of amazing that anyone can still openly advocate that raising taxes on the rich "only ends up hurting middle class" or for "no minimum wage" slavery, without getting the shit kicked out of them. Luckily we still live in a civil society where most people understand violence isn't an acceptable response to political disagreement.
- dang 7y ago
  Would you please stop posting ideological and political battle comments to HN? It's not what this site is for. https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html
- solotronics 7y ago
  I understand you are upset but I ask you to please consider this briefly. If you change conditions to make a specific place more appealing to the rich this does not in any way hurt the poor in that area. If having rich people around was bad for the lower income citizens then people with low income in Monaco would be worse off than people with low income in Africa.
r00fus 7y ago
> If America had one of the lowest corporate tax rates many companies would locate headquarters here and bring that few percent of billions of dollar we wouldn't have otherwise. I think the reality is that while corporations do some jurisdiction shopping, it's pretty clear that low taxes are only one part of the equation of where HQ locations are chosen.

dmos62 7y ago

I like your ideas. However, I don't fully follow the the low corporate taxes one though. Is the idea to compete in a race-to-the-bottom with corporate taxes and profit from trickle-down economics? I think the popular critique of trickle-down is fair.

buboard 7y ago
Corporation tax does not tax (rich) individuals
solotronics 7y ago
It's not a race to the bottom, for a number of reasons America is a good place already for international corporations to have headquarters. We have a strong and mostly fair legal system, and rule of law that many countries do not have. We have a world class workforce. But by having high corporate income tax you are driving away companies that would otherwise HQ here and bring money and taxes. I see benefits and no downsides to making the environment here even more appealing to corportations.
- dmos62 7y ago
  Race to the bottom was not a clear expression of what I meant. I meant that US would compete with other tax environments for lowest corporate taxes, which would drive down corporate taxes globally. The obvious implication is that the corporations then contribute even less to the governmental budgets. In terms of foreign policy, this has the problem of breaking solidarity with other countries. Actually, it seems that the whole idea is based on competition instead of cooperation, but given US policies today, that would be normal. What I'm wondering is would this pay off to the winner that would attract many corporations, but derive minimal taxes from them. What's the mechanism to profit from their operating within your administrative unit in that case?
  - solotronics 7y ago
    Corporations don't exist in a vacuum, they are organizations of people working and recieving salaries. I would argue that by having corporate headquarters located somewhere you are bringing massive net benefit if you only look at salary. The corporate income tax is just extra that the government can squeeze out of them and its become apparent that the biggest corporations can get out of most of that anyways in the US by careful gaming of the tax code. Thus my proposal to lower the rate to a more realistic amount and simplify the tax code. Amazon paid $0 corporate income tax last year on $11 billion in income, they structure the company around reinvesting all the profit for the exact reason of not paying taxes. 2% flat rate for everyone is much better than 0% for the most cunning.

gota 7y ago

I'll focus on the initial part of your post to point out that you _cannot_ trivially avoid taxes for operating in the largest economy in the world while operating in the largest economy in the world. Sure it's possible under certain aspects (like Facebook et al. paying nearly zero under being "mutlinational" and even that relies on the will of the government to allow it) but that does not apply to the US stock market, does it? Unless someone knows something I don't I can't be convinced financial players would stop trading in the US because of taxes unless they are really, really abusive. Some evasion to other markets, perhaps, but how much "down" to developing nations are large funds willing to go? You can't just seamlessly move the entire thing elsewhere. No other country has the economy and international (military) presence. Do we all agree that makes a difference? I can't see this level of taxation changing things at all

ru999gol 7y ago

Its sort of amazing that anyone can still openly advocate that raising taxes on the rich "only ends up hurting middle class" or for "no minimum wage" slavery, without getting the shit kicked out of them. The really crazy thing is they think they are good people, not at all rotten and viscous as they truly are. The cliff between rich and poor is ever more increasing, and you think giving the rich more is going to stop this, you deserve whatever is coming to you when the poor have reached their limit and come knocking on your door. Maybe at least you will realize, that the poor that is going to kick your head in, is not reading Hacker News.

seneca 7y ago
> Its sort of amazing that anyone can still openly advocate that raising taxes on the rich "only ends up hurting middle class" or for "no minimum wage" slavery, without getting the shit kicked out of them. Luckily we still live in a civil society where most people understand violence isn't an acceptable response to political disagreement.
dang 7y ago
Would you please stop posting ideological and political battle comments to HN? It's not what this site is for. https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html
solotronics 7y ago
I understand you are upset but I ask you to please consider this briefly. If you change conditions to make a specific place more appealing to the rich this does not in any way hurt the poor in that area. If having rich people around was bad for the lower income citizens then people with low income in Monaco would be worse off than people with low income in Africa.

r00fus 7y ago

> If America had one of the lowest corporate tax rates many companies would locate headquarters here and bring that few percent of billions of dollar we wouldn't have otherwise. I think the reality is that while corporations do some jurisdiction shopping, it's pretty clear that low taxes are only one part of the equation of where HQ locations are chosen.