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This is a perfect example of why corporate taxes are a sham. Politicians can tell the poor people of Michigan that they are sticking it to the big bad corporations with a tax on revenue. The only effect that can have is to raise the prices of their products. So the consumer (rich and poor) is paying the corporate tax and politicians look like they care.
So in addition to the 6% state sales tax, this revenue tax adds another 5%. So consumers are really paying 11% sales tax not including any local sales taxes.
Once again, the politicians win and consumers lose.
The idea has been around for a few years, but was just proposed as a bill in 2009.
Currently drug dealers, illegal gamblers, and other "criminals" pay no income tax. With The Fair Tax, taxes are paid on the purchase of every new item, including those made by these so-called criminals. There might be some increase in black market sales, but the benefits from taxing this underground economy, along with the other many benefits, would outweigh this increase, IMO. Other benefits: Reduction of tax preparation and filing costs, elimination of the IRS (Collection delegated to SSA), more transparency in tax increases enacted by Congress, less use of overseas bank accounts and businesses, etc.
There is too much "money" residing in the hands of people who don't buy stuff.
Stocks, bonds and real estate just aren't considered, "stuff".
Strikes me as the fastest way to create jobs. Millions of jobs overnight.
Thoughts?
Corporations look at taxes imposed upon them as they do to any other expense. If the corporation manufactures tires, and the cost of rubber goes up, they will:
1. eat the cost, which lowers their profits, which means either reducing the money they spend on advertising, R&D, or reduce the compensation to their shareholders or employees
2. they raise cost of their product to consumers
When taxes are raised on that same corporation, they treat it the same way as they did when the costs for rubber went up.
Maybe the folks on the left think that when a corporation reduces the money its shareholders or employees make, or increase the cost of buying their product, that this is 0bama sticking it to the rich.
Actually, tech companies are hiring. In fact, there is such a shortage of IT engineers in the US that they are hiring in India. The competition for engineers in the US is intense.
Hiring in tech industries has, indeed, improved over last year or so, and after a long period of losing those jobs. Having said that, there is no shortage of IT engineers in the USA. Companies like to hire in countries like India because they can get four employees for the cost of one here.
Quote:
Originally Posted by TomJefferson
I'm not talking about Fortune 500 companies. I'm talking about scores of other corporations that aren't hiring, closed their doors, or are facing uncertainty.
Businesses don't hire when there is little to no demand. This is a fundamental issue with "cut taxes and they will hire" rhetoric many maintain. It is somewhat increased demand that has propelled hiring lately in the USA, compared to say the two-year recessionary period for job growth beginning Jan 2008. If you don't have consumers, why would you produce? And if you're not going to produce, why hire?
The uncertainty you speak of is also due to a fact of political game being played all over the nation. It hasn't been about fixing a problem, it has been about trying to win elections, at any cost. No matter what, I can see many hoping that the countries economic troubles continue and unemployment rises. Because if that doesn't happen, who does it help? Not them.
YYYEEESSS...FINALLY...a REAL solution to our problems...We know once the corporations get their big tax break they will create jobs, i mean what else would they do with that money? Neglect/ruin their core business at the expense of doing things to make their stock more valuable? Use the extra money to find even more clever ways to destroy their labor pool and offshore to the next third world hot spot? Give the CEO an extra 50 million in his Christmas card as a thank for job well done in lobbying the local bought and paid for repukelican to get the 0% rate passed through? Spend 3 million dollars to pay the personal taxes of some big shot executive? Another million to 'renovate' an office for yet another god's gift to capitalism executive?
Thank god for the republican party...If only we could find ways to help the rich and corporations to become even richer...Lord baby jesus we would be doing so great...I mean nevermind that Bush did this and all the proof you could ever need is there that is was a total failure/fubar.
The only reason it won't work is because of those evil, lazy take-from-the-hard-workers give-to-the-lazy-do-nothings democrats...that's the reason this republican 'free market' wet dream hasn't worked!
Yeah the economy was really buzzin along when bush left office!
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