Posted on 05/16/2002 2:27:25 PM PDT by Action-America
Edited on 09/03/2002 4:50:30 AM PDT by Jim Robinson. [history]
HOUSTON (AP) - Shareholders of a Houston-based manufacturer of electrical products, tools and hardware voted Tuesday to reincorporate the company in Bermuda.
Cooper Industries Inc., which is incorporated in Ohio, said the reincorporation offers strategic advantages not available under the company's current structure. Plans for the reincorporation first were announced in February after hand tool maker Danaher Corp. backed away from purchasing Cooper.
Cooper counts Crescent wrenches and pliers among its brands.
The reincorporation is expected to generate $55 million in additional cash flow and add 58 cents per share to earnings, the company said.
(Excerpt) Read more at newsday.com ...
The answer is NOT to pass even more oppressive laws. In fact, laws meant to discourage almost always have an effect that is the exact opposite of the intended effect. In this case, the side effect of more oppressive laws would likely be to force both current US companies and previously expatriated companies to take the once unthought-of step of moving their entire operation offshore.
The solution is to repeal the oppressive laws that are driving this expatriation and pass laws that are meant to encourage large companies and wealthy individuals to stay.
The US system of worldwide taxation on income is actually what is forcing companies to reincorporate offshore or to even move their entire operation offshore. It's also one of the primary things that is forcing around 100,000 wealthy individuals to take all of their wealth and expatriate, in favor of more wealth friendly jurisdictions, every year. In fact, because of the USA Patriot Act and other even more oppressive proposed legislation, the number of wealthy individuals choosing to expatriate this year is likely to increase well beyond 100,000.
Remember that the top 5% of taxpayers pay over 55% of all personal income tax collected. The top 1% pay more than 36%. Unless Congress and the Whitehouse is willing to suspend the Constitution (something that may not be too far off), they cannot stop the wealthy from leaving. So, the question that this level of expatriation raises is,
"Who is going to pay the taxes, when the wealthy are gone?"
For more on government induced individual capital flight, see "Tick-Tick-Tick - The Economy Bomb".
The only option currently on the table that will not only encourage wealth to stay, but will actually encourage the repatriation of previously expatriated wealth, is the National Retail Sales Tax (NRST).
Another one gone, thanks to government greed.
Check it out!
It ain't just the wealthy.
By the way, she is a special-ed teacher, masters degree, 14 years experience. Y'know, the folks all the schools are cryin' for? I think Bush said something about teachers, and how we need them.
But the gubmint then proceeded to tax her out of a job.
Oh, well. My life will be better with her not working.
Good work, if you can get it. LOL!
The only option currently on the table that will not only encourage wealth to stay, but will actually encourage the repatriation of previously expatriated wealth, is the National Retail Sales Tax (NRST).
Might even pull in a few more folks besides:
Rep. Bill Archer, Chairman, House Ways and Means Committee:
I don't see any reason at all why we should not be the corporate safe harbor for the world supporting economic growth & job security for this nation, instead of encouraging security for Burmuda and like tax havens.
Now, with heavy industry moving its tax dollars away from Uncle Sam, they're noticing. I'm glad!
Perhaps this will bring us to tax reform?! I anticipate many more businesses and individuals to move soon... making this a more urgent issue for all those
tax-n-spenders.
I love hitting them in the pocketbook! It's what they've been doing to us for 88 years!
It is indeed a small world. At some point we will have to understand that our nation must compete on a world wide basis.
We will learn the lesson, but it always takes us a while. I doubt that Canada, Europe and Japan will ever learn the lesson.
Perhaps this will bring us to tax reform?!
The biggest problem is what kind of tax reform the politico's are really being talked into? Looks like they are pushing toward the Flat Tax variant of a VAT to conform to WTO standards for taxation:
see: U.S. Business Taxes May Face Overhaul (WTO)
in regard to:
http://www.taxfoundation.org/foundationmessage03-00.html
"Under the WTO definition of the term, a sales tax is an indirect tax, as is an European-style VAT. The economic equivalence of an European-style VAT and a subtraction-method VAT is well-established. A subtraction-method VAT is essentially identical to a business income tax except that all purchases of plant and equipment may be expensed, rather than depreciated as under current U.S. law."
FLAT TAX, VAT TAX, ANYTHING BUT THAT TAX; Duke Law Magazine, Spring 96:
- "The flat tax is essentially a VAT, with a personalized element for wages. Thus, the business tax allows deduction of all purchases -- as does a VAT -- but also allows deduction of wages. The wage income that is taken out of the VAT base, however, is also taxed, but is assessed against the individual wage-earner, not against the business."
Here is the logic of our system, stripped to basics: We want to tax consumption. The public does one of two things with its income—spends it or invests it. We can measure consumption as income minus investment. A really simple tax would just have each firm pay tax on the total amount of income generated by the firm less that firm’s investment in plant and equipment. The value-added tax works just that way. But a value-added tax is unfair because it is not progressive. That’s why we break the tax in two. The firm pays tax on all the income generated at the firm except the income paid to its workers. The workers pay tax on what they earn, and the tax they pay is progressive. To measure the total amount of income generated at a business, the best approach is to take the total receipts of the firm over the year and subtract the payments the firm has made to its workers and suppliers. This approach guarantees a comprehensive tax base. The successful value-added taxes in Europe work this way. The base for the business tax is the following:
Total revenue from sales of goods and services
less
purchases of inputs from other firms
less
wages, salaries, and pensions paid to workers
less
purchases of plant and equipment
The other piece is the wage tax. Each family pays 19 percent of its wage, salary, and pension income over a family allowance (the allowance makes the system progressive). The base for the compensation tax is total wages, salaries, and retirement benefits less the total amount of family allowances.
Concerning Proposals for a Flat-Rate Consumption Tax
Testimony before the Joint Economic Committee; May 17, 1995
- The Hall-Rabushka flat tax, and its Armey and Specter variants, would replace the current personal and corporate income taxes with a new tax that is conceptually identical to a "subtraction-method" value-added tax, a version of a national sales tax, with two major modifications: First, imports would be exempt from the flat tax, while exports would be subject to tax. Second, to mitigate the regressivity of the VAT, cash wages, pensions received and other cash earned income would be taken out of the VAT base (i.e., deducted by businesses) and taxed directly to individuals, with exemptions. Thus, structurally, the flat tax is exactly equal to a value-added tax with an import incentive, an export disincentive and a personal rebate based on a percentage of a capped amount of cash wages, pensions and other earned income. Businesses compute a typical "subtraction-method" value-added tax by adding up their taxable gross receipts and subtracting the cost of previously taxed items. Thus, in computing the VAT, businesses deduct their purchases from other businesses, whether for supplies, services, machines, land or whatever.
- Russia 1, U.S. 0 (Look who was first to adopt the ideal free-market tax system.)
- Russia Imposes Flat Tax on Income, and Its Coffers Swell
- RUSSIA Russian Federation Tax Code (a Flat Tax)
- From Russia With Love
- From Russia, one-steppe taxation
- More Russians Paying Income Taxes (Flat Tax Works)
- Tax reform Russia - 1, U.S. - 0
Especially considering the Russian system, at heart, is a model European style VAT with income tax:
Seems as though there is one big push to get the American people to accept a Euro standard Tax system, (i.e. corporate VAT; "hidden tax") by giving it a pretty label and selling as something else.
Don't the pols see this?
Bottom line, expatriots don't have political clout as regards votes in the election, guess who does:
Walter Williams, World Net Daily, 10-25-2000
According to the most recent U.S. Treasury Department figures, ... the top 50 percent ($36,000 and over) paid 96 percent of income taxes. Guess what the bottom 50 percent of income earners paid?
If you're among those who pay little or no federal income taxes, what do you care about tax cuts? Moreover, if you think tax cuts pose a threat to government handout programs, you might be openly hostile and support Al Gore's silly "risky scheme" talk. So many Americans paying little or no federal taxes makes for a natural spending constituency. It's like me in the restaurant: What do I care about extravagance if you're footing the bill?
70% of the public clamors for more from government believing someone else foots the bill. That perception continues to grow ever stronger by eliminating even more participants from the Federal Individual Income Tax rolls through tax reduction proposals, changes in personal exemption limits and other mechanisms such as the EITC all of which come to play in the current propositions regarding the Flat Vat and other taxes similarly structured such as transaction taxes etc.
The push is to hide the burden from the view of the electorate, providing the appearance of a free meal ticket, while creating the perfect scape goat to blame for rising prices and inflation due to rising tax burdens(business). Most pols have only one interest, buying that next vote and staying in power. All other considerations tend to take second seat to that political reality. Thus the perpetual shell game, and vilification of commercial interests playing rich against poor.
As long as they can convince over half the electorate that the government toothfairy exists,
A government which robs Peter to pay Paul can always depend on the support of Paul.
-George Bernard Shaw
rules the day.
To remove taxation of the individual, is to remove the goad which assures accountability of government to the electorate. Federal tax rates are high because a majority of the electorate do not share proportionately in the burden their demand for largesse imposes on the minority of citizens.
The siren call for representation without taxation is the formula that got us where we are at today. The ability to hide or disguise taxation from the view of large sectors of the electorate allows the Congress to get away with the creation of the evergrowing monster that it fosters.
Liberty and freedom have a price, responsibility. If that price is avoided, or not perceived, there are no brakes on the growth of government, the ultimate result is the end of freedom through creeping socialism.
That has been clear message to us for over 200 years
In general, the art of government consists in taking as much money as possible from one party of the citizens to give to the other.
-Voltaire (1764)
Sir Alex Fraser Tytler (1742-1813). Scottish jurist and historian:
"A democracy cannot exist as a permanent form of government. It can only exist until the voters discover that they can vote themselves largess from the public treasury. From that time on the majority always votes for the candidates promising the most benefits from the public treasury, with the results that a democracy always collapses over loose fiscal policy, always followed by a dictatorship.
Seems as those who ignore history are indeed going to repeat it once more.
If we are going to change things, we have to put it in terms that mean something to that 70% of voting public clamoring for more government. The expatriots already know the score and are exercising their options. It's out of that 70% that votes must come from to cause the necessary change in the system.
The full quote, including the famous sequence of growth to decay, can be found at:
I will be changing the attribution accordingly.
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