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> Raise corporate taxes and reduce income taxes. I'm not sure you can generate much if any extra money from that. Total revenue from income tax was $4.47 tri

> Raise corporate taxes and reduce income taxes. I'm not sure you can generate much if any extra money from that. Total revenue from income tax was $4.47 trillion in 2023, while only 0.42$ came from corporate tax. If you raise corporate taxes significantly revenue won't increase proportionally since companies will just find more efficient ways to spend money (more investment might somewhat offset that, though).

autoexecbat 2y ago
This implies it doesn't really matter what the corporate tax rates are But this is testable in reverse, what happens to tax revenue when corporate taxes are cut? The tax revenue goes down.
- kjkjadksj 2y ago
  People also forget that corporate taxes are a consumer burdon as they are the ones who are passed these costs to pay them. Profits aren’t going to be impinged.
  - fakedang 2y ago
    And then market forces will decide to reward companies that do not follow that policy (assuming it's not a monopolistic market). The company which does not pass its costs will be able to capture the market easily. Seeing this in action right now, between the supermarket chains in my European town's central square.
- Wytwwww 2y ago
  > what happens to tax revenue when corporate taxes are cut? The tax revenue goes down. Sure? I'm talking specifically about significantly cutting income taxes in combination with raising corporate taxes and expecting to end up with the same tax revenue.
fakedang 2y ago
That's kind of the point - increase corporate taxation so that companies are incentivized to spend, and spend on actual investments instead of share buybacks. I guess I didn't put it out clearly, but the current definitions of corporate taxation are highly flawed. I once read in a book about corporate management by a Japanese CEO (I think it was Matsushita). His philosophy was that paying taxes should be an inescapable duty of a corporation, since their very existence is facilitated by the government providing them a business environment and their unimpaired customers paying them revenues. Interestingly, I also had a related conversation with someone from the Singapore Ministry of Economy who echoed the same principle, but from the government's perspective - it's the duty of the government to provide a facilitatory and unhindered business environment with reasonable taxation so that companies are incentivized to pay taxes. As of now, the US has a similar corporate tax rate to Singapore yet doing business is worlds different between the two (especially if you don't count Delaware).
- Wytwwww 2y ago
  > I guess I didn't put it out clearly, Replying just because you said since it's still not clear at all: > but the current definitions of corporate taxation are highly flawed. I assumed that you meant that the government could significantly cut income taxes, raise corporate taxes and end up with the same or higher amount of money. I just don't see how is that feasible unless US could force most other countries in the world to do the same.
  - fakedang 2y ago
    The US is already forcing a lot of countries to follow their stead, to the point that the US is now one of the world's best tax havens to park illicit cash. With the Double Irish sandwich being shut down, I can only see more internal schemes being developed within the US - corporations aren't rushing to park gains in Seychelles or Guernsey. The point is that the US needs to find a balance between taxation and good business, kind of like Switzerland in the EU (although I agree, both are different ballgames altogether). The way I see it, there's a triangle here with three vertices to balance against - business pragmatism, optimal taxation and regulations for private markets.

autoexecbat 2y ago

This implies it doesn't really matter what the corporate tax rates are But this is testable in reverse, what happens to tax revenue when corporate taxes are cut? The tax revenue goes down.

kjkjadksj 2y ago
People also forget that corporate taxes are a consumer burdon as they are the ones who are passed these costs to pay them. Profits aren’t going to be impinged.
- fakedang 2y ago
  And then market forces will decide to reward companies that do not follow that policy (assuming it's not a monopolistic market). The company which does not pass its costs will be able to capture the market easily. Seeing this in action right now, between the supermarket chains in my European town's central square.
Wytwwww 2y ago
> what happens to tax revenue when corporate taxes are cut? The tax revenue goes down. Sure? I'm talking specifically about significantly cutting income taxes in combination with raising corporate taxes and expecting to end up with the same tax revenue.

fakedang 2y ago

That's kind of the point - increase corporate taxation so that companies are incentivized to spend, and spend on actual investments instead of share buybacks. I guess I didn't put it out clearly, but the current definitions of corporate taxation are highly flawed. I once read in a book about corporate management by a Japanese CEO (I think it was Matsushita). His philosophy was that paying taxes should be an inescapable duty of a corporation, since their very existence is facilitated by the government providing them a business environment and their unimpaired customers paying them revenues. Interestingly, I also had a related conversation with someone from the Singapore Ministry of Economy who echoed the same principle, but from the government's perspective - it's the duty of the government to provide a facilitatory and unhindered business environment with reasonable taxation so that companies are incentivized to pay taxes. As of now, the US has a similar corporate tax rate to Singapore yet doing business is worlds different between the two (especially if you don't count Delaware).

Wytwwww 2y ago
> I guess I didn't put it out clearly, Replying just because you said since it's still not clear at all: > but the current definitions of corporate taxation are highly flawed. I assumed that you meant that the government could significantly cut income taxes, raise corporate taxes and end up with the same or higher amount of money. I just don't see how is that feasible unless US could force most other countries in the world to do the same.
- fakedang 2y ago
  The US is already forcing a lot of countries to follow their stead, to the point that the US is now one of the world's best tax havens to park illicit cash. With the Double Irish sandwich being shut down, I can only see more internal schemes being developed within the US - corporations aren't rushing to park gains in Seychelles or Guernsey. The point is that the US needs to find a balance between taxation and good business, kind of like Switzerland in the EU (although I agree, both are different ballgames altogether). The way I see it, there's a triangle here with three vertices to balance against - business pragmatism, optimal taxation and regulations for private markets.