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There's a common talking point about corporations not paying their dues. - A megacorp that pays 0% in income taxes still pays a ton of sales tax on things it b
by FredPret 3y ago
There's a common talking point about corporations not paying their dues.
- A megacorp that pays 0% in income taxes still pays a ton of sales tax on things it buys
- Every employee pays income tax, sales taxes, income gains taxes on their investments, and eventually death taxes
- The owners pay taxes on dividends received and capital gains in rising share prices, and all the same sales et al taxes as the employees on the remaining amount.
- The economic activity generated by the 0% megacorp will create higher incomes for other corporations, all of whom are subject to the above taxes, and not all of whom manages to avoid all income taxes.
The fact is that dodging tax is at best a temporary aberration. There are many financial tricks to delay and minimize taxes, but the government will always take its pound of flesh eventually.
Also, at some point the owners of that money will spend it / gift it / die and then it gets taxed.
Even in the USA, where these corporations are supposed to rule the roost, government spending as a % of the economy has been skyrocketing for the past century.
Even if the government banned all income tax, they would stealth-tax us by issuing bonds and inflating the currency away.
To boost their careers, top bureaucrats the world over need their headcount to keep growing, so they demand blank cheques from the productive with an air of moral sanctimony that's almost impressive.
I fully support reasonable taxes to feed & educate the children of the poor and many other nice things, but the bureaucracy is a monster that never stops growing unless we make it.
Something to keep in mind next time John Oliver goes on a rant.
- strangetortoise 3y ago>- A megacorp that pays 0% in income taxes still pays a ton of sales tax on things it buys Not familiar with the US, is this actually true? In europe, as a company, you're allowed to subtract VAT on products bought from VAT owed from sales. That would contradict most of what you're saying.
- seanmcdirmid 3y agoIt depends on the state I think. Sales tax is only implemented per state in the USA. I know Boeing gets an explicit sales tax exemption from Washington state on planes it sells. But things would be really weird otherwise.
- systemvoltage 3y agoI think you're talking about reseller exemption. Boeing or any other manufacturing company. For example, in the chain of iron ore -> steel -> pistons -> engine -> car: In USA, each of the middle steps get what is called a "reseller's exemption certificate" and the sales tax is only charged when you walk out of the dealer. In EU, each of the steps get VAT taxed, but they can remit the taxes from the next step. Overall effect is the same, but USA's system is simpler and easier with less paperwork. American suppliers have to get a certificate only once and then its all set. No sales tax is collected by the buyer for established repeated relationships. One time paperwork.
- reisse 3y ago> - A megacorp that pays 0% in income taxes still pays a ton of sales tax on things it buys I wonder if they can set up an entity in Delaware (where the most corps are incorporated anyway) and pay zero sales tax.