Two-thirds of corporations pay no income tax... Let's increase that number!
Aug 15th 2008 5:30PM
Updated Aug 16th 2008 8:44PM
I see it completely differently. First of all, corporations don't really pay any income taxes at all. People do. Every time a company decides to sell something to you, the price depends on a lot of things, including how much it costs to make the item, how much profit the company wants to make, and how high the company's tax bill is. You, the consumer, end up paying the corporate income tax with higher prices. And you want more of that?
My second big problem with people demanding more corporate income taxes is the result that would have on U.S. businesses. Our country really doesn't need anything else to make us less competitive in manufacturing. The same people moaning about big businesses making too much money and not paying enough taxes are the same ones belly-aching about jobs going overseas.
Newsflash for you: More taxes here will mean more jobs going overseas. It's simple economics, and companies must turn a profit in order to stay in business. Take away their profits, and you take away their reason for existing.
The focus on corporate income taxes is misguided. Look at all the other tax money the government collects via the business these corporations do. They create jobs, which creates payroll taxes, and creates income to individuals which is taxed. It sounds like there's plenty of taxing going on, and adding another layer by demanding that more corporations pay more income taxes doesn't seem necessary.
Don't forget that taxes paid to the government don't really add to our economy. The government's job is not to see how much they can collect from citizens and spend as much as possible on unnecessary programs and mandates. Let taxpayers keep their money and decide what's important to them. There will be a far bigger benefit to our economy by letting taxpayers choose where to spend their money and by letting that money work through private businesses, which are historically far more productive and efficient than our government.
Don't forget too, that our tax laws are what they are. Corporations hire tax specialists who help them figure out how to legally pay as little in taxes as they can, which means working within the tax code to increase the amount of profit kept by the companies. Cheating on taxes is wrong, but staying within the legal limits while reducing the exposure to taxes makes good business sense.... Not just for the companies, but also for the consumers who rely on the jobs they create and products and services we need and want to buy.
Tracy L. Coenen, CPA, MBA, CFE performs fraud examinations and financial investigations for her company Sequence Inc. Forensic Accounting, and is the author of Essentials of Corporate Fraud.