3 ms·
>A zero corporate tax rate would highly disincentivise corporate reinvesting into things like capex for expansion or R&D This is simply not true. The investme
by anonuser123456 5y ago
>A zero corporate tax rate would highly disincentivise corporate reinvesting into things like capex for expansion or R&D
This is simply not true. The investment equilibrium would change in favor of less investment in _lower_ return expenditures. Corporate managers would likely distribute more capital, which would then be reallocated efficiently in the market. The only hitch here is that the government would likely collect higher tax receipts, and thus lower total investment. But that's an argument for lowering the tax rate on investment income, not creating bad incentives for corporate managers to spend money with a lower marginal rate of return than their core business.
>There's also the fact that corporations are only made possible in the first places because of the infrastructure and services provided by the government, and those must be paid for.
Corporations pay property taxes, use taxes and payroll taxes already (e.g. truckers pay gas taxes, and that's reflected in retain prices etc). And since the proposal is for revenue neutrality, the delta revenue is still collected on the distribution end.
>Of infrastructure resources they used then indirect funding of such things via taxes would be required as much.
You can simply look at the budget. The vast majority of government spending is on income transfers, administrative expenses for social programs and jobs programs (the largest of which is bombing people in foreign countries). A very tiny sliver is infrastructure that corporations use. And as pointed out above, most of that can be paid for via use taxes they already pay.
- deleted 5y ago[deleted]
- ineedasername 5y agoYour viewpoint is fairly well contradicted by recent experience with corporate tax cuts that were not reinvested back into the company and were instead used for massive stock buy backs that gave the money to investors and upper management with their own shares to sell back into the rising prices, which is what I said happens with zero tax rates. Do you think if they went even lower that would change? The use taxes you're referring to are mostly going to state-level entities and state infrastructure. They're not going to pay for the federal resources, and I mentioned services, not just infrastructure. Heck, the amount of resources they use in government legal services, courts etc alone are significant costs that companies pay practically nothing but miniscule filing fees to use. Further, even those state level taxes are often minimal in the race to the bottom of states giving massive tax cuts that negate much of the revenue for the sources you mention. As for annual spending on infrastructure: yes, that is at least partially right and is exactly why we have an infrastructure crisis in the country with aging facilities, bridges, etc and no money to pay for it. Whatever companies are paying in use taxes, it's certainly not enough to keep pace with our needs. Are you an advocate for use taxes, or was that just a rhetorical device? Because if you really believe they are appropriately paying use tax, and given the infrastructure crisis, you should be all for increases to those use taxes.