In an earth shattering and shocking report released yesterday the Institute of Tax and Economic Policy concluded that corporations are dodging taxes through loop holes left open by the Trump tax law and are only paying 14% in taxes. Meanwhile profits are at an all time high, equity is at an all time high, and the deficit is still high - although much lower than the Trump era. Something is rotten in Denmark. Corporate Tax Avoidance in the First Five Years of the Trump Tax Law The tax overhaul signed into law by former President Donald Trump in 2017 cut the federal corporate income tax rate from 35 percent to 21 percent, but during the first five years it has been in effect, most profitable corporations paid considerably less than that. This is mainly due to loopholes and special breaks that the 2017 tax law left in place and, in some cases, introduced. Corporate tax avoidance occurs because Congress allows it to occur, and the Trump tax law in many ways made it worse. The corporate minimum tax and expanded tax enforcement funding signed into law in 2022 by President Biden could begin to reduce corporate tax avoidance, as would other proposals from the White House that have not yet become law. This study examines federal corporate income taxes paid by the largest profitable corporations from 2018 through 2022. Because the corporations included in this study were profitable each year for all five of those years, one would reasonably expect that they would pay significant taxes. But in many cases, they did not. The 342 companies included in this study paid an average effective income tax rate of just 14.1 percent during this five-year period, almost a third less than the statutory rate of 21 percent. Nearly a quarter of the corporations in this study (87 companies) paid effective tax rates in the single digits or less during this five-year period.
The very same corporations that are part of the portfolios of the 401K millionaires you credit Bidenomics for.
This study examines federal corporate income taxes paid by the largest profitable corporations from 2018 through 2022. "Because the corporations included in this study were profitable each year for all five of those years, one would reasonably expect that they would pay significant taxes." What does "significant" mean here? I have always felt that, like individuals, companies should pay whatever the tax rate is based on current law. I think any loophole presents potential problems as it provides a means to exploit the system. Having said that, I think tax rates above 20% are outrageous, especially when being sent to a federal government that wastes those tax dollars by the billions. I say lower the tax rates, get rid of loopholes, and force the government to work from a budget with less money. There will still be enough to go around.
I see the stupidty of our tax code every end of December when I have to spend random money on shit and hold deposits until January to avoid earnings. It's so dumb every year
A close study of Bidenomics would have taught you that it is only responsible for the good things in the economy.
Do you think more than 20% is outrageous because you don’t like how the revenue is spent or simply because corporations shouldn’t have to pay more than 20%? If the latter, why?
I always love to rile up some posters on this board when I say corporate tax rate should be 0. The cost of taxes get passed on to the consumer anyway. So we might as well collect taxes where they finish their travels, at the individual. Lower corporate taxes, higher individual taxes at upper brackets.
Corporations are people though, so just tax them too at the higher rate under the income tax since they are 'individuals'
It is interesting how correct this formulation seems to me and you, and how obviously villainous it seems to most other people.
I will go even further in the riling up category by saying not only do I think 0% is the right corporate tax rate, I also think Citizens was the right decision regarding corporate speech. Taxing corporations doesn’t help actual people, but limiting corporate speech does actually hurt actual people.
I think how the revenue is spent is a different topic. To the second point, I could ask you the same. Why does the Federal government feel they have the right to take upwards of 20%? I don't care how much money a company makes, in my opinion 20% should be about the cap. Why, because it's 1/5, and I think that's plenty. It's a simple as that.
Who gets the deduction for the frozen embryos in Alabama, the parents or the lab? On a serious note every entity or person that can, takes advantage of the tax code where allowable. I'd be mad at my accountant if he didn't, and companies owe a fiduciary obligation to their shareholders, not the IRS of federal government. At a minimum we should get rid of double taxation.
Why a separate rule for corporations, who are “persons”? Human persons pay as much as 37%. I read somewhere that Amazon, for example, paid just 6% on $35 billion in profits. Tesla paid zero. My marginal tax rate was higher than both.
I agree with you there, so was mine(MTR). So somewhere between 37% and 0% is a happy medium... hence my 20%. And get rid of "loopholes".
I mean, were talking about a complete overhaul of our tax system that will never happen. But yeah, you two aren't wrong. All this stuff would have to change
35 trillion in debt and a yearly 1.5 trillion deficit...raise taxes on everyone! That'll fix everything.
