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The corporate business community is sitting on 2 trillion dollars in liquid assets right now and they haven't creating any meaningfull increase in jobs. Why would giving them more money to take out of circulation promote any more jobs?
The corporate business community is sitting on 2 trillion dollars in liquid assets right now and they haven't creating any meaningfull increase in jobs. Why would giving them more money to take out of circulation promote any more jobs?
Thank you and others for stating the obvious.
Am fed up to the back teeth with these "cut corporate taxes so the economy can grow" ideas. The cold hard facts point to something very different.
Taxes are *not* one of the high ranking problems for most American businesses, at least on the Federal level. Yes some places like New York, New Jersey and so forth do have onerous taxes and as a result are losing businesses but there is often more to it than that. High cost of living and overall business climate are more of a concern than taxes.
Case in point the business community and their supporters finally got Washington D.C. to pass a "tax holiday" so they could bring billions of overseas profits into the USA at lower rates. They told us it would "stimulate" the economy, create jobs and so froth. It did nearly none of that. Companies used that money for everything else but including share buy backs.
I would end corporate income taxes and any tax an employer has to pay employees like the match for ss. the unemployment contribution, workman's comp etc.
I think we should lower the corporate tax rate. But businesses will not hire simply because of lower taxes. We will hire when the middle-class (what's left of it) starts spending again. Without increased consumption, look for several years of high unemployment....because any tax breaks for business will not = more jobs.
The problem is, the middle class can only spend what they actually get to take home. And with our tax code, a combination of state and federal income taxes, "payroll" taxes, property tax, sales taxes, fuel taxes, plus all the "hidden" taxes on businesses and producers factored into every product they purchase, they actually only have about 50% of their income to spend to start with. Want to increase personal spending? Quit confiscating so much from the productive class with taxes. Government needs to reign in it's greed.
A friend sent me this article. It talks about the elimination of the corporate income tax as a solution to unemployment. The writer estimates the corporate taxes to bring in $300 billion a year; but that figure is overshadowed by the governmental expenses of corporate subsidies , bailouts and price supports, estimated to be $350 billion/year.(Gov. Subsidies have reportedly doubled in the last 20 years to 1,800 programs!) Eliminating corporate income taxes and the government's financial support of corporations would theoretically, result in a savings of about $50 billion/yr and businesses would put this money into expansion and jobs resulting in a timely end to unemployment.
I would end corporate income taxes and any tax an employer has to pay employees like the match for ss. the unemployment contribution, workman's comp etc.
Just who do you propose to pay the other half of employee's FICA and other contributions?
Ask any self-employed person about estimated quarterly taxes and how much they must shell out in "payroll taxes" and you'll have your eyes opened.
Take away an employer contributing half of SS and other payments is a recipe for disaster I'm afraid. Put it another way, you cannot escape such taxes unless you earn <13K or so a year IIRC. Everyone else pays and often it is much more than what you see deducted from paychecks.
Just who do you propose to pay the other half of employee's FICA and other contributions?
They have to demand an increase in their wages and since the company is no longer paying it they will have plenty of money to do it. When they get a look at what the real tax is let the fireworks begin.
The issue I have with corporate/business taxes is those costs are hidden from the consumer or employee. If we get rid of them and move it to sales tax or make the employee pay them you can then expose those expenses to them.
Too many people walk into Wally world and buy a TV thinking they are paying 6% tax on it when that is not even remotely close to what they are really paying in tax.
Two other important points. Firstly by taxing the product instead of the business it doesn't matter where the product is made or who is making it. They can't avoid the tax. This would significantly increase the competitiveness of US made products. Secondly corporations no longer have the need to shelter that money overseas and can bring it home to invest here.
Government gives those corporate subsidies because the corporations write the legislation to get them. Now you want to, in essence, let them double dip by not paying taxes. This is nothing new. It's the same old BS we have seen for 45 years that has never worked. Just more trickle down BS. Only difference is now instead of money trickling down the promise is that jobs will trickle down.
The jobs won't materialize out of thin air. They moved the the jobs offshore to take advantage of cheep labor. Unless people are willing to work for a dollar per hour. That won't even pay for transportation to and from work.
Snake oil politics is not new.
Two other important points. Firstly by taxing the product instead of the business it doesn't matter where the product is made or who is making it. They can't avoid the tax. This would significantly increase the competitiveness of US made products. Secondly corporations no longer have the need to shelter that money overseas and can bring it home to invest here.
Lone among most Western and even some Eastern nations the USA does not have a Value Added Tax (VAT). Powerful interests have kept it this way and will fight tooth and nail against it ever being introduced to these shores. Wait I tell I lie, one state had VAT (Michigan?) but it didn't last long and was repealed.
VAT is quite wonderful at doing what it is meant to do; raise revenue. To some it is *too* good and that is the problem. There is also the fact many places where VAT was introduced it was to be in lieu of income taxes. Things quite haven't worked out that way as most countries have both income and VAT taxation though perhaps the former is a several points lower than it otherwise would be.
Taxing consumption instead of income has been deemed far better for governments for ages; but some just don't want to hear. In an economy such as the United States where consumer activity is a very large part of generating revenue businesses (and the government for that matter) are very leery of doing anything that might poison that well.
You can tell persons all you want that their income taxes will be lower but all they will hear is another tax (sales) will be levied upon most goods and services. Worse unlike income taxes there would be few to nil ways of escaping payment.
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