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You tax it when they take the money out to spend it on themselves
by namdnay 5y ago
You tax it when they take the money out to spend it on themselves
- judahmeek 5y agoThat would require a progressive, rather than moralistic, sales tax.
- salawat 5y agoExcept they don't. They create corporations to do it for them. As long as creating a legal fiction is a mere matter of having someone else do paperwork, you either need to extract tax from legal fictions, or kiss a big chunk of taxable activity goodbye.
- fighterpilot 5y agoI don't think that's accurate if we're talking about large publicly listed companies, the only way for shareholders to spend the money on themselves is to take it out via dividends or sell the stock for a capital gain.
- Nicholas_C 5y agoShareholders can take out a loan for spending money that uses the shares as collateral.
- fighterpilot 5y agoTo pay back the loan they need to sell the stock which is a capital gains event. The two main tax avoidance strategies would be people running and retiring overseas just before selling, or never selling and waiting for the cost basis to be reset upon their death.
- runT1ME 5y agoThis isn’t legal. A corporation that leases someone a car and a house is paying them a taxable income, regardless of it not being a cash income.
- matkoniecz 5y agoIt is trivial to work around. Spending would turn into various non-monetary and indirect compensations. It is going already but would get even more efficient.