Jeff G
Well-known member
- Joined
- Nov 25, 2001
- Posts
- 184
Speaking of corporate welfare:
Now, when you think about it, corporate taxes are really double taxation. What are corporate taxes? Taxes on corporate profits. Who makes corporate profits? A corporation, which either plows the profits back into the business (thus growing the business and employing more people, who pay more in personal income taxes), pays the corporation's employees more (thus generating more personal income taxes), or distributes profits to shareholders as dividends (which is then taxed as capital gains). In other words, every dollar of "corporate profits" is distributed to people who then pay taxes on it again.
So what is "corporate welfare"? Mostly tax breaks on corporate profits for politically deserving companies. IOW, politicians reduce the amount of double taxation for certain companies.
So here's a novel concept. Eliminate corporate taxation entirely. Corporations will still pay sales taxes and excise taxes on products they buy but will no longer be forced to give the government a cut when they have a good year. Instead, their employees will pay taxes on their personal income. This also eliminates political games regarding which companies are "worthy" of welfare.
Corporations are not nameless, faceless, money-generating, tax revenue-producing monoliths. They are made up of taxpayers. So why cripple successful companies with double-taxation to begin with?
Makes about as much sense as taxing the dead and reducing the estate to be left to descendents. But that's another story.
Now, when you think about it, corporate taxes are really double taxation. What are corporate taxes? Taxes on corporate profits. Who makes corporate profits? A corporation, which either plows the profits back into the business (thus growing the business and employing more people, who pay more in personal income taxes), pays the corporation's employees more (thus generating more personal income taxes), or distributes profits to shareholders as dividends (which is then taxed as capital gains). In other words, every dollar of "corporate profits" is distributed to people who then pay taxes on it again.
So what is "corporate welfare"? Mostly tax breaks on corporate profits for politically deserving companies. IOW, politicians reduce the amount of double taxation for certain companies.
So here's a novel concept. Eliminate corporate taxation entirely. Corporations will still pay sales taxes and excise taxes on products they buy but will no longer be forced to give the government a cut when they have a good year. Instead, their employees will pay taxes on their personal income. This also eliminates political games regarding which companies are "worthy" of welfare.
Corporations are not nameless, faceless, money-generating, tax revenue-producing monoliths. They are made up of taxpayers. So why cripple successful companies with double-taxation to begin with?
Makes about as much sense as taxing the dead and reducing the estate to be left to descendents. But that's another story.
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