Posted on 08/29/2009 6:31:38 PM PDT by hiho hiho
My argument is that if corporate taxes were eliminated, then there could be fairer price competition among businesses.
(CALGARY, Alberta) - Houdini was able to make an elephant disappear in a crowded theatre. How was he able to do it? Misdirection.
Misdirection is the primary process in our tax system and no one wants to explain it. I’ve tried more than once over the last thirty years, but the mainstream media (the little people who are the gatekeepers) will not touch it. Here it is.
A press release from The Oregon Center for Public Policy published elsewhere on this site (“Latest Revenue Forecast Shows That Even With Tax Increase, Corporations' Share of Income Taxes Still Lags” http://www.salem-news.com/articles/august282009/corporate_taxes_8-28-09.php) points out that corporations are apparently not paying their share of the tax burden. "The corporate tax increase is a modest but important step toward tax fairness," said OCPP executive director Chuck Sheketoff. "But in spite of the corporate tax measure, working families and small businesses will continue carrying the load for corporations."
Misdirection. Misdirection. Misdirection.
This is not a criticism of the OCPP statement, because they are simply repeating the same mythology that everyone else unthinkingly generates. But…
Businesses treat taxes as an expense just like they do wages and cost of material, etc. These are all totalled, then subtracted from the revenue/income to leave a net profit.
Net profit is always after tax and companies need a net profit in order to stay in business. This means that prices for goods and services are always adjusted to the so-called bottom line. If corporate taxes go up, then it follows like night follows day, that prices will also go up. If taxes go down then, theoretically, prices can also go down.
Here’s my point: ALL taxes are paid by individuals. There are no exceptions because any taxes that corporations appear to pay are in every case passed on to the customers of that business as part of the price for goods or services. Eat at McDonald’s? A few pennies of what you pay are earmarked for the taxes that McDonald’s as a corporation will pay. Except that you paid them.
I have long advocated for the elimination of corporate taxation. But I am not supporting the investors’ view that it’s about double taxation, i.e., the corporation is first taxed, then the investor is taxed on their dividends.
My argument is that if corporate taxes were eliminated, then there could be fairer price competition among businesses. Most important, though, would be a transparency in the tax collection. People would know absolutely that, as Sheketoff of the OCPP said: “working families and small businesses will continue carrying the load…” But the misdirection would be gone.
(Quotation credit Barack Hussein Oh..Mama)
Hey, unexpected kudos to Ben Affleck[tion]. Someone actually knows less about something than Ben does.
An even better idea - abolish the capital gains tax. It collects approximately $100 billion a year, but I wager it’s easily restricting 10 times that amount in market activity.
If you want to re-energize and recapitalize the markets, you cannot use the banks (which are limited in their asset-to-loan ratios); you need to get private investment flowing again. Eliminate capital gains taxes and you’d see a flood of private money that would be Biblical in proportion.
The only truly legal tax is sales tax - that's it. And it would work perfectly, because tax money would rise only when the economy rose.
But the purpose of taxation is more than mere funding.
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