10 ms·

We Don't Need A Corporate Income Tax

39 points by cogware 12y ago

ckluis 12y ago
Without a serious discussion on the actual figures its hard to take political discussions seriously. Tax people instead of corporations to make it easier. On principle it might sound good, but what % does it need to go up and for what % of the population? On principle - only tax software companies, lawyers, and accountants fight a simplified tax code.
- sien 12y ago
  It's worth looking at the levels of taxation around the world: http://en.wikipedia.org/wiki/List_of_countries_by_tax_rates http://en.wikipedia.org/wiki/List_of_countries_by_tax_rates The US has a high theoretical company tax rate but a low practical one because of the myriad of deductions. Reducing the corporate tax rate rather than abolishing it may make more sense and make less attractive to play tax games and waste effort on that rather than creating value.
  - roganp 12y ago
    These comparisons are hard to make sense of because of the different services provided by these governments. For example, health care is a government benefit in most European countries, paid for by their "higher" tax rates.
    - adventured 12y ago
      The US has the worst of both worlds currently. Relatively high taxes and a wildly inefficient government. We spend $7 trillion per year in government expenditures, at all levels, and can't even seem to maintain basic infrastructure (we could, but our government is really terrible).
      - chasing 12y ago
        I'd like to hear more about what basic infrastructure is lacking in your part of the US.
- chasing 12y ago
  Absolutely. There's not a single dollar figure in this entire opinion piece. Which makes it tough to really weigh her argument except from a sort of moral or "gee, that seems reasonable" standpoint. I wish political and economic journalists would be as willing to use real numbers and statistics as sports reporters are...
deleted 12y ago
[deleted]
roganp 12y ago
Unfortunately, I don't think eliminating corporate taxes will eliminate tax code complexity. It will add to the complexity of personal taxes as the well off rush to hide assets and income in un-taxed corporations. The only solution to that, for the tax man, are ever more complicated rules for determining what can be counted as personal income.
- adventured 12y ago
  Can you elaborate on how personal income, capital gains, and perhaps estate taxes can't cover all scenarios? How will assets and income be hidden in untaxed corporations?
  - tarikjn 12y ago
    LLCs allow owners to declare personal/corporate taxes under the same umbrella. Same for sole proprietorship and other structures.
- tarikjn 12y ago
  You make a very good point. Maybe the solution then is to eliminate income tax altogether? We didn't have Federal income tax until 1913, and I am surprised at why we need to pay so much in Federal taxes when the state/local governments are the ones providing most of the services. The federal government has other significant sources of income, and a large majority of the spending is definitely wasteful, it would start by eliminating most of the IRS/tax law/enforcement cost, before even starting to look at the rest. Also of note is that the income tax was voted into law amid pretty non-democratic conditions, and now we assume it must be absolutely needed because we've become accustomed/dependent on it.
  - chasing 12y ago
    Non-democratic? After a quick a-Googlin', it seems like the income tax was made legal by the 16th Amendment, which has been properly ratified by 42 states.
    - 12y ago
mwsherman 12y ago
Despite the title, the real thrust of the piece is that regulations – taxes, here – are inputs into a complex system. The more complex, the less predictable and the more likely to have unintended consequences. Or, perhaps, “intended” consequences which benefit certain participants over others. We think that of regulations as rules of the road, or adding fairness, or enhancing transparency. And they might! But those assumptions are, often, insufficient models and at worst, dangerously incorrect.
rayiner 12y ago
This is an excellent article. The key takeaway starts here: > I know what you’re thinking. You want a simple tax code that raises a bunch of money by closing the loopholes. Many people think this because they think that taxing income is simple, so “loopholes” must be illicit backdoors placed in the tax code at the behest of greedy corporations. > And to be sure, the tax code contains plenty of senseless giveaways to corporations. But these are small beer. Most of the “loopholes” that we argue about are not a result of congressional pandering, or even sharp lawyers who bend sensible rules. They’re an artifact of the fact that calculating corporate income is really hard. I realized this when I was taking an introductory course in federal income tax, and trying to figure out the effect of different depreciation schedules. There's a neat logic to the income tax, including complex concepts like depreciation.[1] Yet, things that are simple to state as an equation are quite complex to implement in practice. For example, things like loss carry-forwards arise from trying to tax a continuous parameter (changes in wealth over time), in discrete, annual time-steps. I disagree with people who think corporate taxes are "double taxation" or anything like that. Taxing corporations falls naturally out of treating them as distinct legal persons. A corporation's income is treated, and taxed, distinctly from shareholders' income for the same reason a corporations legal liabilities are treated distinctly from shareholders' liabilities. It's just the flip side of the coin. That said, while corporate make sense within the logic of the tax code, in practice they are probably more trouble than they are worth, and create bad incentives for companies to relocate their operations out of the U.S. [1] I recommend http://www.amazon.com/Chirelsteins-Federal-Income-Taxation-Students/dp/1587783800 http://www.amazon.com/Chirelsteins-Federal-Income-Taxation-S... for a very approachable introduction to the topic. Don't be scared off by the page-count: it's big type on paperback pages.
- jacques_chester 12y ago
  > I disagree with people who think corporate taxes are "double taxation" or anything like that. Australia has dividend imputation because of this argument. When you receive dividends from shares you own, the tax paid by the company is offset from your own personal income with "franking credits". So along with a different capital gains framework, the net upshot is that Australian shareholders are quite happy to take dividends, thankyou. Which means companies can focus more on running things at a profit and less on trying to pump up the stock price any way, any how. The downside is that Australia has a higher headline corporate tax rate than a lot of countries. An argument is sometimes made that we could significantly lower it (as in by double digits) without imputation. (This is of course not financial advice and I am not an accountant, lawyer, planner or even a dog on the internet).
edoceo 12y ago
I think corporate tax should be simpler but not eliminated. I have started and run multiple companies in three states. In the early/small days its annoying to pay the CPA more than the total tax burden due to "red tape" requirements. Taxes (in theory) fund education and social services which is a solid foundation to build my businesses on I'm OK paying just, make it less terrible.
programminggeek 12y ago
I don't think taxes are the problem. I think the complexity ends up benefiting those who have more resources at their disposal and actually acts as a moat to discourage smaller businesses growth or people from starting businesses. The ability to afford lawyers and accountants to play the system for every write off is a big advantage and so if anything the incentives to large companies is to increase complexity of laws and regulation, which I think is why for all the money and lobbying, laws are getting MORE complex, not less. A simple system with minimal regulations, sensible rates, and no "loopholes" would be much preferable to what we have now. Maybe take it a step further and make it a small transaction tax whenever money changes hands instead of an income tax. Make the transaction tax on every financial transaction, from purchasing equipment to buying a sandwich, and keep the rates the same for pretty much everything. Don't have stupid exclusions like large purchases of houses, equipment, buildings, or expensive services. All of a sudden write offs and loop holes pretty much go away, you already have the infrastructure to collect transaction taxes via sales taxes and if you levied it on ALL financial transactions it would probably be < 1%. I'm pretty sure it would be too much change to ever make it through government without being ruined, but it'd probably be better than what we have now.
- roganp 12y ago
  I heard Marc Andreessan make a very similar point in an interview. His theory is that the large regulatory burden of being a public company is causing a dearth of IPOs as companies wait to grow large enough to pay for dedicated compliance departments.
arikrak 12y ago
I don't understand why profits of a company need to be taxed. Either the money gets re-invested in the business or it gets paid as a dividend. Why does there need to be a separate tax from the dividend?
- adventured 12y ago
  The only argument you'll tend to get is a strictly emotional, highly irrational one. Namely that without an income tax, corporations will just pile up cash forever, and somehow magically that'll make wealthy people wealthier. This argument will include the notion that only CEOs and uber rich investors control all public corporations, and they'll find a way to steal all that cash without ever paying taxes on it. That 'somehow' the rich will game the changes and all that will happen is the corporate income tax revenue will disappear.
- rayiner 12y ago
  Imagine I want to set up a package delivery service in a world where corporations don't exist. Package delivery services are pretty risky businesses: delivery drivers race through crowded streets and are liable to run into someone or someone's property sooner or later. Now, say I want to figure out a way to insulate myself from that sort of liability. So I enter into an agreement with a driver. I'll buy him a delivery truck, and he'll deliver the packages. In return, he'll give me 75% of what's left over after his expenses. Now I'm insulated from legal liability. I'm just an investor. If he runs over someone, that person can't sue me in my personal capacity. All I have at risk is the truck I bought him. But wait. What's the tax treatment of this arrangement? The driver will be taxed on his net income (revenues - expenses). Then he'll give me 75% of what he has left over. Then I'll be taxed on that amount. Separate taxation of corporation arises naturally from treating corporations as distinct legal persons.
  - judk 12y ago
    "Corporations are legal persons" is begging the question. "Legal person" means 'designated entity with special rules', it doesn't carry any intuition or logical consequences beyond whatever the chosen rules are.
anigbrowl 12y ago
I'm broadly in sympathy with the article's arguments, but: Depreciation of corporate jets, meanwhile, is not some special loophole. All assets depreciate, which is to say they become less valuable over time as they become outdated and suffer wear and tear. Both financial accounting and the tax code recognize this. Depreciation is how the tax code handles investment expenses; if you disallow this, you would be essentially levying extra-heavy taxes on capital-intensive businesses. There's a big difference between depreciation of your plant and machinery that form a core part of your business and that of luxury purchases for the C-suite. Airlines should certainly be able to depreciate their jets, so should companies like UPS and Fedex that run large air freight operations. So should any business for which flying is part of the business model. But I'm not convinced that flying executives, investors, and suppliers around in a Lear Jet is essential in the same way. Rather, that seems like a really nice intangible bonus for the upper management to enjoy. And if firms want to spend money on that and shareholders don't object,* then OK - but either tax it as benefits-in-kind or disallow the depreciation. * Not that the views of American shareholders are generally welcomed by management, but that's another issue.
- zaroth 12y ago
  Disallowing depreciation would increase the cost by 40%, in other words basically outlawing the use of private jets. Doesn't sound like a good idea. How do you single out providing a nicer airplane for business travel as a taxable benefit without treating the same any asset your employees use to make doing their job more pleasant? You create an impossible job of trying to decide what constitutes a "large enough" ROI for the business. Buy your employees nice monitors? Must be a benefit! Ergonomic chairs? Tax it! Take a corporate bus to work? Charge em' per mile! A nap room that employees sometimes spend the night in? Serving filet in the cafe? Forget about that espresso machine in the break room. Oh, and that artwork on the wall's got to go. A basket ball hoop in the parking lot; that's a fitness stipend by another name! For something to rise to the level of a taxable employee benefit it has to provide a lot more tangible direct personal value than this, and virtually zero business ROI. All this is actually the perfect example for how nice it would be if we could find a better way to tax which avoided this mess.
  - 12y ago
ryandrake 12y ago
Didn't Lucky Ducky [1] show us how unfair corporate income taxes are? 1: http://boingboing.net/2013/05/29/tom-the-dancing-bug-lucky-duc-3.html http://boingboing.net/2013/05/29/tom-the-dancing-bug-lucky-d...
cpeterso 12y ago
An alternative to corporate income tax is Georgism, a land value tax that is design to encourage productive use of land and other resources: https://en.wikipedia.org/wiki/Georgism https://en.wikipedia.org/wiki/Georgism
- nextw33k 12y ago
  I do not see how that applies in an Internet era. It would create an incentive to locate offshore as much as possible. It you are talking about a capital tax then the same applies. As a CEO I would look to move assets abroad as soon as possible.
pbreit 12y ago
I'd like to see a proposal more along the lines of "lower rate and simpler". The two examples don't strike me as that compelling. Carried interest seems like income. Depreciation is just a question of timing, not amount (time-value of money notwithstanding; which is marginal).
oksawe 12y ago
I'm shocked. Most of these comments have to be from a corporate lobby group. "of the Fortune 500 companies... companies studied paid just 18.5 percent of their profits in U.S. corporate income taxes... Thirty of the companies paid less than nothing and had negative corporate income tax rates" The following article will explain it much better than I could. http://ctj.org/ctjreports/2013/04/bernie_sanders_is_right_and_the_tax_foundation_is_wrong_the_us_has_very_low_corporate_income_taxes.php#.U8c6YlYaCuc http://ctj.org/ctjreports/2013/04/bernie_sanders_is_right_an...
misterbishop 12y ago
Corporations receive hundreds of millions in direct public subsidy: http://www.businessweek.com/articles/2013-11-12/boeing-grabs-jumbo-subsidies-from-washington-state-for-777x-jobs http://www.businessweek.com/articles/2013-11-12/boeing-grabs... Corporations benefit greatly from costly American military efforts abroad: http://money.msn.com/investing/10-companies-profiting-most-from-war http://money.msn.com/investing/10-companies-profiting-most-f... The Federal government negotiates international trade deals on behalf of corporations: http://www.washingtonpost.com/blogs/wonkblog/wp/2013/12/11/everything-you-need-to-know-about-the-trans-pacific-partnership/ http://www.washingtonpost.com/blogs/wonkblog/wp/2013/12/11/e... Corporations make massive profits based on the findings of publicly-funded scientific research: http://www.nejm.org/doi/full/10.1056/NEJMsa1008268 http://www.nejm.org/doi/full/10.1056/NEJMsa1008268 Corporations pay their employees so little that regular people have to subsidize their income: http://www.forbes.com/sites/clareoconnor/2014/04/15/report-walmart-workers-cost-taxpayers-6-2-billion-in-public-assistance/ http://www.forbes.com/sites/clareoconnor/2014/04/15/report-w... This is not a question of being "taxed twice". Corporations are the recipients of incalculable public welfare, and they generate billions in profit. Of course they should be taxed. They should be taxed progressively according to their income. And the idea that the United States doesn't provide an "attractive climate" for corporations is just completely insane. Also, this article is poorly written. Next time, use http://www.hemingwayapp.com/ http://www.hemingwayapp.com/
- oksawe 12y ago
  Thank you. I almost lost it reading the article and the comments here. Corporations also heavily use the court system, benefit from a publicly paid education system, roads, infrastructure... I could go on and on.
  - misterbishop 12y ago
    The highest positions in government are stacked with former/future corporate employees. Our former vice president was the CEO of Halliburton. Our current attorney general was a partner at one of the largest corporate law firms in the world. This is the norm not the exception. So the idea that there's friction between corporations and "The Government" is just not serious. The government largely functions to keep American corporations happy and profitable.

39 points by cogware 12y ago

Without a serious discussion on the actual figures its hard to take political discussions seriously. Tax people instead of corporations to make it easier. On principle it might sound good, but what % does it need to go up and for what % of the population? On principle - only tax software companies, lawyers, and accountants fight a simplified tax code.

sien 12y ago
It's worth looking at the levels of taxation around the world: http://en.wikipedia.org/wiki/List_of_countries_by_tax_rates http://en.wikipedia.org/wiki/List_of_countries_by_tax_rates The US has a high theoretical company tax rate but a low practical one because of the myriad of deductions. Reducing the corporate tax rate rather than abolishing it may make more sense and make less attractive to play tax games and waste effort on that rather than creating value.
- roganp 12y ago
  These comparisons are hard to make sense of because of the different services provided by these governments. For example, health care is a government benefit in most European countries, paid for by their "higher" tax rates.
  - adventured 12y ago
    The US has the worst of both worlds currently. Relatively high taxes and a wildly inefficient government. We spend $7 trillion per year in government expenditures, at all levels, and can't even seem to maintain basic infrastructure (we could, but our government is really terrible).
    - chasing 12y ago
      I'd like to hear more about what basic infrastructure is lacking in your part of the US.
chasing 12y ago
Absolutely. There's not a single dollar figure in this entire opinion piece. Which makes it tough to really weigh her argument except from a sort of moral or "gee, that seems reasonable" standpoint. I wish political and economic journalists would be as willing to use real numbers and statistics as sports reporters are...

deleted 12y ago

[deleted]

roganp 12y ago

Unfortunately, I don't think eliminating corporate taxes will eliminate tax code complexity. It will add to the complexity of personal taxes as the well off rush to hide assets and income in un-taxed corporations. The only solution to that, for the tax man, are ever more complicated rules for determining what can be counted as personal income.

adventured 12y ago
Can you elaborate on how personal income, capital gains, and perhaps estate taxes can't cover all scenarios? How will assets and income be hidden in untaxed corporations?
- tarikjn 12y ago
  LLCs allow owners to declare personal/corporate taxes under the same umbrella. Same for sole proprietorship and other structures.
tarikjn 12y ago
You make a very good point. Maybe the solution then is to eliminate income tax altogether? We didn't have Federal income tax until 1913, and I am surprised at why we need to pay so much in Federal taxes when the state/local governments are the ones providing most of the services. The federal government has other significant sources of income, and a large majority of the spending is definitely wasteful, it would start by eliminating most of the IRS/tax law/enforcement cost, before even starting to look at the rest. Also of note is that the income tax was voted into law amid pretty non-democratic conditions, and now we assume it must be absolutely needed because we've become accustomed/dependent on it.
- chasing 12y ago
  Non-democratic? After a quick a-Googlin', it seems like the income tax was made legal by the 16th Amendment, which has been properly ratified by 42 states.
  - 12y ago

mwsherman 12y ago

Despite the title, the real thrust of the piece is that regulations – taxes, here – are inputs into a complex system. The more complex, the less predictable and the more likely to have unintended consequences. Or, perhaps, “intended” consequences which benefit certain participants over others. We think that of regulations as rules of the road, or adding fairness, or enhancing transparency. And they might! But those assumptions are, often, insufficient models and at worst, dangerously incorrect.

rayiner 12y ago

This is an excellent article. The key takeaway starts here: > I know what you’re thinking. You want a simple tax code that raises a bunch of money by closing the loopholes. Many people think this because they think that taxing income is simple, so “loopholes” must be illicit backdoors placed in the tax code at the behest of greedy corporations. > And to be sure, the tax code contains plenty of senseless giveaways to corporations. But these are small beer. Most of the “loopholes” that we argue about are not a result of congressional pandering, or even sharp lawyers who bend sensible rules. They’re an artifact of the fact that calculating corporate income is really hard. I realized this when I was taking an introductory course in federal income tax, and trying to figure out the effect of different depreciation schedules. There's a neat logic to the income tax, including complex concepts like depreciation.[1] Yet, things that are simple to state as an equation are quite complex to implement in practice. For example, things like loss carry-forwards arise from trying to tax a continuous parameter (changes in wealth over time), in discrete, annual time-steps. I disagree with people who think corporate taxes are "double taxation" or anything like that. Taxing corporations falls naturally out of treating them as distinct legal persons. A corporation's income is treated, and taxed, distinctly from shareholders' income for the same reason a corporations legal liabilities are treated distinctly from shareholders' liabilities. It's just the flip side of the coin. That said, while corporate make sense within the logic of the tax code, in practice they are probably more trouble than they are worth, and create bad incentives for companies to relocate their operations out of the U.S. [1] I recommend http://www.amazon.com/Chirelsteins-Federal-Income-Taxation-Students/dp/1587783800 http://www.amazon.com/Chirelsteins-Federal-Income-Taxation-S... for a very approachable introduction to the topic. Don't be scared off by the page-count: it's big type on paperback pages.

jacques_chester 12y ago
> I disagree with people who think corporate taxes are "double taxation" or anything like that. Australia has dividend imputation because of this argument. When you receive dividends from shares you own, the tax paid by the company is offset from your own personal income with "franking credits". So along with a different capital gains framework, the net upshot is that Australian shareholders are quite happy to take dividends, thankyou. Which means companies can focus more on running things at a profit and less on trying to pump up the stock price any way, any how. The downside is that Australia has a higher headline corporate tax rate than a lot of countries. An argument is sometimes made that we could significantly lower it (as in by double digits) without imputation. (This is of course not financial advice and I am not an accountant, lawyer, planner or even a dog on the internet).

edoceo 12y ago

I think corporate tax should be simpler but not eliminated. I have started and run multiple companies in three states. In the early/small days its annoying to pay the CPA more than the total tax burden due to "red tape" requirements. Taxes (in theory) fund education and social services which is a solid foundation to build my businesses on I'm OK paying just, make it less terrible.

programminggeek 12y ago

I don't think taxes are the problem. I think the complexity ends up benefiting those who have more resources at their disposal and actually acts as a moat to discourage smaller businesses growth or people from starting businesses. The ability to afford lawyers and accountants to play the system for every write off is a big advantage and so if anything the incentives to large companies is to increase complexity of laws and regulation, which I think is why for all the money and lobbying, laws are getting MORE complex, not less. A simple system with minimal regulations, sensible rates, and no "loopholes" would be much preferable to what we have now. Maybe take it a step further and make it a small transaction tax whenever money changes hands instead of an income tax. Make the transaction tax on every financial transaction, from purchasing equipment to buying a sandwich, and keep the rates the same for pretty much everything. Don't have stupid exclusions like large purchases of houses, equipment, buildings, or expensive services. All of a sudden write offs and loop holes pretty much go away, you already have the infrastructure to collect transaction taxes via sales taxes and if you levied it on ALL financial transactions it would probably be < 1%. I'm pretty sure it would be too much change to ever make it through government without being ruined, but it'd probably be better than what we have now.

roganp 12y ago
I heard Marc Andreessan make a very similar point in an interview. His theory is that the large regulatory burden of being a public company is causing a dearth of IPOs as companies wait to grow large enough to pay for dedicated compliance departments.

arikrak 12y ago

I don't understand why profits of a company need to be taxed. Either the money gets re-invested in the business or it gets paid as a dividend. Why does there need to be a separate tax from the dividend?

adventured 12y ago
The only argument you'll tend to get is a strictly emotional, highly irrational one. Namely that without an income tax, corporations will just pile up cash forever, and somehow magically that'll make wealthy people wealthier. This argument will include the notion that only CEOs and uber rich investors control all public corporations, and they'll find a way to steal all that cash without ever paying taxes on it. That 'somehow' the rich will game the changes and all that will happen is the corporate income tax revenue will disappear.
rayiner 12y ago
Imagine I want to set up a package delivery service in a world where corporations don't exist. Package delivery services are pretty risky businesses: delivery drivers race through crowded streets and are liable to run into someone or someone's property sooner or later. Now, say I want to figure out a way to insulate myself from that sort of liability. So I enter into an agreement with a driver. I'll buy him a delivery truck, and he'll deliver the packages. In return, he'll give me 75% of what's left over after his expenses. Now I'm insulated from legal liability. I'm just an investor. If he runs over someone, that person can't sue me in my personal capacity. All I have at risk is the truck I bought him. But wait. What's the tax treatment of this arrangement? The driver will be taxed on his net income (revenues - expenses). Then he'll give me 75% of what he has left over. Then I'll be taxed on that amount. Separate taxation of corporation arises naturally from treating corporations as distinct legal persons.
- judk 12y ago
  "Corporations are legal persons" is begging the question. "Legal person" means 'designated entity with special rules', it doesn't carry any intuition or logical consequences beyond whatever the chosen rules are.

anigbrowl 12y ago

I'm broadly in sympathy with the article's arguments, but: Depreciation of corporate jets, meanwhile, is not some special loophole. All assets depreciate, which is to say they become less valuable over time as they become outdated and suffer wear and tear. Both financial accounting and the tax code recognize this. Depreciation is how the tax code handles investment expenses; if you disallow this, you would be essentially levying extra-heavy taxes on capital-intensive businesses. There's a big difference between depreciation of your plant and machinery that form a core part of your business and that of luxury purchases for the C-suite. Airlines should certainly be able to depreciate their jets, so should companies like UPS and Fedex that run large air freight operations. So should any business for which flying is part of the business model. But I'm not convinced that flying executives, investors, and suppliers around in a Lear Jet is essential in the same way. Rather, that seems like a really nice intangible bonus for the upper management to enjoy. And if firms want to spend money on that and shareholders don't object,* then OK - but either tax it as benefits-in-kind or disallow the depreciation. * Not that the views of American shareholders are generally welcomed by management, but that's another issue.

zaroth 12y ago
Disallowing depreciation would increase the cost by 40%, in other words basically outlawing the use of private jets. Doesn't sound like a good idea. How do you single out providing a nicer airplane for business travel as a taxable benefit without treating the same any asset your employees use to make doing their job more pleasant? You create an impossible job of trying to decide what constitutes a "large enough" ROI for the business. Buy your employees nice monitors? Must be a benefit! Ergonomic chairs? Tax it! Take a corporate bus to work? Charge em' per mile! A nap room that employees sometimes spend the night in? Serving filet in the cafe? Forget about that espresso machine in the break room. Oh, and that artwork on the wall's got to go. A basket ball hoop in the parking lot; that's a fitness stipend by another name! For something to rise to the level of a taxable employee benefit it has to provide a lot more tangible direct personal value than this, and virtually zero business ROI. All this is actually the perfect example for how nice it would be if we could find a better way to tax which avoided this mess.
- 12y ago

ryandrake 12y ago

Didn't Lucky Ducky [1] show us how unfair corporate income taxes are? 1: http://boingboing.net/2013/05/29/tom-the-dancing-bug-lucky-duc-3.html http://boingboing.net/2013/05/29/tom-the-dancing-bug-lucky-d...

cpeterso 12y ago

An alternative to corporate income tax is Georgism, a land value tax that is design to encourage productive use of land and other resources: https://en.wikipedia.org/wiki/Georgism https://en.wikipedia.org/wiki/Georgism

nextw33k 12y ago
I do not see how that applies in an Internet era. It would create an incentive to locate offshore as much as possible. It you are talking about a capital tax then the same applies. As a CEO I would look to move assets abroad as soon as possible.

pbreit 12y ago

I'd like to see a proposal more along the lines of "lower rate and simpler". The two examples don't strike me as that compelling. Carried interest seems like income. Depreciation is just a question of timing, not amount (time-value of money notwithstanding; which is marginal).

oksawe 12y ago

I'm shocked. Most of these comments have to be from a corporate lobby group. "of the Fortune 500 companies... companies studied paid just 18.5 percent of their profits in U.S. corporate income taxes... Thirty of the companies paid less than nothing and had negative corporate income tax rates" The following article will explain it much better than I could. http://ctj.org/ctjreports/2013/04/bernie_sanders_is_right_and_the_tax_foundation_is_wrong_the_us_has_very_low_corporate_income_taxes.php#.U8c6YlYaCuc http://ctj.org/ctjreports/2013/04/bernie_sanders_is_right_an...

misterbishop 12y ago

Corporations receive hundreds of millions in direct public subsidy: http://www.businessweek.com/articles/2013-11-12/boeing-grabs-jumbo-subsidies-from-washington-state-for-777x-jobs http://www.businessweek.com/articles/2013-11-12/boeing-grabs... Corporations benefit greatly from costly American military efforts abroad: http://money.msn.com/investing/10-companies-profiting-most-from-war http://money.msn.com/investing/10-companies-profiting-most-f... The Federal government negotiates international trade deals on behalf of corporations: http://www.washingtonpost.com/blogs/wonkblog/wp/2013/12/11/everything-you-need-to-know-about-the-trans-pacific-partnership/ http://www.washingtonpost.com/blogs/wonkblog/wp/2013/12/11/e... Corporations make massive profits based on the findings of publicly-funded scientific research: http://www.nejm.org/doi/full/10.1056/NEJMsa1008268 http://www.nejm.org/doi/full/10.1056/NEJMsa1008268 Corporations pay their employees so little that regular people have to subsidize their income: http://www.forbes.com/sites/clareoconnor/2014/04/15/report-walmart-workers-cost-taxpayers-6-2-billion-in-public-assistance/ http://www.forbes.com/sites/clareoconnor/2014/04/15/report-w... This is not a question of being "taxed twice". Corporations are the recipients of incalculable public welfare, and they generate billions in profit. Of course they should be taxed. They should be taxed progressively according to their income. And the idea that the United States doesn't provide an "attractive climate" for corporations is just completely insane. Also, this article is poorly written. Next time, use http://www.hemingwayapp.com/ http://www.hemingwayapp.com/

oksawe 12y ago
Thank you. I almost lost it reading the article and the comments here. Corporations also heavily use the court system, benefit from a publicly paid education system, roads, infrastructure... I could go on and on.
- misterbishop 12y ago
  The highest positions in government are stacked with former/future corporate employees. Our former vice president was the CEO of Halliburton. Our current attorney general was a partner at one of the largest corporate law firms in the world. This is the norm not the exception. So the idea that there's friction between corporations and "The Government" is just not serious. The government largely functions to keep American corporations happy and profitable.