Should Corporations Be Taxed ?
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Sunday, December 4, 2011
(1) Individuals and privately owned business' are taxed on income or profit and have to compete with corporations, so why not tax corporations?
(2) Corporations started closing down plants and moving them out of the country due to cheaper labor.
(3) U.S encouraged them to move out by giving them tax breaks to produce outside and ship back in to the U.S. (Free Trade agreements).
(4) Large corporations found out they could reduce tax or eliminate them all together moving their patents out of the country (Pfizer) or moving their headquarters out. Halliburton received millions of dollars of contracts from United States, moved their headquarters to Dubai, UAE to avoid taxes. Cooper Industries was given 3.6 million in government contracts and moved their headquarters from Houston to Bermuda.
(5) Many of the corporations moving headquarters out are leaving just to avoid taxes, not manufacturing anything. GE however, plans to move their headquarters and their 115 year old plant at Wisconsin to Beijing, invest $6 billion in 6 research centers and employ 65 engineers.
(6) You can't blame corporations for moving out. Our tax rates vary from zero ( Exon-Mobil) to 42% (Conoco-Phillips). In one instance our rate was 28%, Great Briton's rate was 25% and Ireland's 20%. Many were much lower. How the IRS arrives at corporate rates is beyond imagination.
(7) United States is on the brink of disaster. We have lost over 3 million manufacturing jobs and 850,000 professional and service jobs and losing more every day. We have 13.9 million unemployed with 49.6% living below poverty level. We are no longer a self sufficient country.
(8) Government spending, pumped in the economy is the only thing that temporarily keeps the country going when business dries up. Spending cuts increase unemployment and makes matters worse.
WHAT CAN WE DO ?
(1) Since we have to raise revenue, It imperaitive we place a tariff on all imports (except food, fuel and other essentials we cannot produce ourselves), enough to balance the tax being evaded by foreign manufacturers. Priorities should be given to computers (12 million imported in 2010) TVs, other electronics, appliances, furniture, automobiles and other things which can be manufactured in the U.S.
(2) The second most tax evasive law is the Capital Gains Law. It allows corporate officers to pay themselves a million dollar salary, then issue themselves incentives and bonuses of 100,000 shares of stock which they hold for one year, sell for $50 a share and pay 15% Capital Gains tax on a $500,000 income. The best solution would be to change the law to allow 15% Capital Gains Tax only after the item was purchased and held 10 years or longer.
(3) To make up for current lost revenue it would certainly be proper to increase the tax rate on those who earned one million dollars and probably higher on those earned a billion dollars or more.
The Norquist Pledge signors and "big Money" from the corporations and the wealthy will make all the above very difficult to pass but hopefully they will see the light and help avert a catastrophe.