taxes...

Saw an editorial the other day in the New York Times calling it a ' uniquely American paradox '. On the one hand, US corporate tax rates are among the highest in the world, yet, on the other, the actual taxes that these corporations pay are among the lowest in the world. The Real tax rate is not the nominal 40% more often than not the rate is Zero.

The G.A.O. said last week that two of every three companies paid no federal income tax of any kind in the 7 years from '98 to '05. 1.3 million corp. returns were scrutinized [ total annual sales of $ 2.5 trillion!!] and 66 % of those were able to record enough expenses - tax deductions - to avoid paying any taxes.

The largest 1000 companies [ assets of $ 250 million or sales of $ 50 mil. ]only 25% [ combined revenue of $ 1.1 trillion ] escaped taxes completely, the other 75% paid a tax rate much lower than the nominal.

US Corp. pays the lowest tax rate since WWII and provide the least tax revenue as a percent of GDP. The US has the second highest combined statutory corporate tax rate among the top 30 democracies - yet is tied with Hungary for the 4th lowest amount of corp. taxrevenue relative to GDP.. equal to a mere 2.2% per year.

Companies shop the world for the lowest rate looking for the cheapest ' sticker price'..though the advertized fee isn't for real.. especcially the US one. In national economies, governments used to be able to tax corps as captive entitites, now its a buyers' market. More and more governments compete for corporations, for the investment in infrastructure and jobs and more and more companies are free to chose what they'll pay.

" international companies" pay less in taxes to the US than " domestic" corps...

Economists [ well, some anyway ] claim that corporate taxes are the most destructive of all taxes, in a global economy high tax rates can only be appllied on ' immovable property ' or on personal consumption...

so...

1981- corporate tax rate was 47% in '94 down to 40% '07 27.6%..

not worth the trouble. elimination of corporate tax would stimulate economic growth and would produce far less cumbersome, far less bureaucratic and far less corrupt tax regimes. The perfect corporate tax rate is nuthin'..

Wonder if Obama or McCain would consider dismantling all that government red tape, infrasructure and gobbledy gook that sees companies ' incorporate ' in some sandy beach island resort and just bring in a single one size fits all, everyone pays 10% flat tax...

simple reporting form..
Line 1] what did you make from all sources last year?
Line 2] give us 10%

no deductions, no crap..

[ course it would put a lot of 'civil' servants out of work...then, again, maybe not.. ]

just a thought...

on a ' related' note.. saw that the head of Ford in Canada has quit to head up the New Holland farm equipment company, which is a division of Agribusiness corp of Germany, which is a division of someone else which is owned by Fiat..

so, since it appears that only six companies own the world, who needs taxes anyway?

This message has been edited. Last edited by: Rocketeer,

Millions of people work for those corporations and pay income taxes,etc,. Add that up. Corporations also now pay for most insurance/daycare you name it. By the way who is taxing everybody? Federal, State and local idiots is who.

CORPORATE WASHINGTON <<<< The biggest one of all.

not suggesting that corporations stop ' benefits' to employees or abrogate agreements with unions, state support, etc.. but, since they manage not to pay corporation tax anyway, why pretend that it counts? just eliminate it, companies free from the 'burden' will flock to the place to set up shop.. or so the theory goes..

in the same time, everyone gets to save a huge chunk on their taxes and doesn't have to fill in ever more complicating tax forms by simply paying a flat tax... 10%...but, the catch is that there are no deductions, or other ways of hiding funds from the gov't.. every p[erson, company and who/whatever pays 10% on everything that they make, from whatever sources... simple.. and, actually, it would result in the government getting more money for the useful public efforts governments are empowered to do.

the only guys then avoiding taxes would be the usual mob - drug dealers, career criminals and the like..

much more civilized...

of course that would mean the politicians would have to pay 10% on all their bribes and other under-the-table funds/fees and commissions...

True. Still nothing ever goes back down does it? I have to pay taxes in almost every state and I just love the new ( fake ) Hotel parking fee that they snuck in after 9/11. Just keep chopping up the pie.

I'm sick of the whole deal. Flat tax, revamp it, whatever. It's definitely broke. Fix it.

I don't think a flat tax rate is necessarily the best option. Can you really blame the corporations for shopping around for the best deals. You can't tell me that you wouldn't get the best deal possible and maximize your profits. It is like when you go to the grocery store. You expect the corporations to buy Name brand or HY-Vee brand.