Taxes

[Steve Ja]

What do you think the impact would be of eliminating Corporate taxes? On the economy on wages, on employment... How should we make up for the lost revenue of around $300 billion? Make the capital gains taxes the same as income taxes? Cut spending? and on what programs? Will there be less revenue overall, or will it actually result in more revenues through increased wages and employment. I'd like to see what everyone is thinking on this subject.

I personally Would like to see it eliminated all together. I think it will actually result in increased revenues for the government through more employment as companies will have more to spend. Also will result in companies spending more money on research, and expansion. Results more revenues.

 

[cpwill]

What do you think the impact would be of eliminating Corporate taxes? On the economy on wages, on employment... How should we make up for the lost revenue of around $300 billion? Make the capital gains taxes the same as income taxes? Cut spending? and on what programs? Will there be less revenue overall, or will it actually result in more revenues through increased wages and employment. I'd like to see what everyone is thinking on this subject.

I personally Would like to see it eliminated all together. I think it will actually result in increased revenues for the government through more employment as companies will have more to spend. Also will result in companies spending more money on research, and expansion. Results more revenues.

1. We would not see a direct $300 Bn loss, as the beneficial economic activity would drive other sources of revenue up. I'm not saying they would replace the full $300 Bn within one tax year, only that they would mitigate the loss of Corporate taxes as a form of federal income, and that that mitigation would become heavier the further out you move in time.

2. We would become a tax shelter for the rest of the world. Businesses from all over would want to set up here, with beneficial results for our population.

3. We should treat dividends as regular income, as it would no longer be subject to double taxation. Treating capital gains the same way would help mitigate the original loss of revenue as well, though, again, not nearly as much as you would expect from a static score.

 

[Steve Ja]

1. We would not see a direct $300 Bn loss, as the beneficial economic activity would drive other sources of revenue up. I'm not saying they would replace the full $300 Bn within one tax year, only that they would mitigate the loss of Corporate taxes as a form of federal income, and that that mitigation would become heavier the further out you move in time.

2. We would become a tax shelter for the rest of the world. Businesses from all over would want to set up here, with beneficial results for our population.

3. We should treat dividends as regular income, as it would no longer be subject to double taxation. Treating capital gains the same way would help mitigate the original loss of revenue as well, though, again, not nearly as much as you would expect from a static score.

I believe you and I are on the same exact page on this one.

 

[ludin]

I personally think that our current tax system is to antiquated.

I truely believe in taxing consumption over wages. which is why i fall more into the fair tax plan. You basically don't pay taxes up to the poverty level based on family size.
so a family of 4 would get 559 a month to spend on basic essentials, food, utilities etc. other than that you pay a 23% inclusive tax on any new item and service you get.

what is meant by inclusive. the tax is already in the price of the item. so if you buy something for 10 dollars you pay 10 dollars. the company then sends 2.30 cents to the government.

there is not a corporate tax or payroll tax and there is not a capital gains tax.

 

[Steve Ja]

I personally think that our current tax system is to antiquated.

I truely believe in taxing consumption over wages. which is why i fall more into the fair tax plan. You basically don't pay taxes up to the poverty level based on family size.
so a family of 4 would get 559 a month to spend on basic essentials, food, utilities etc. other than that you pay a 23% inclusive tax on any new item and service you get.

what is meant by inclusive. the tax is already in the price of the item. so if you buy something for 10 dollars you pay 10 dollars. the company then sends 2.30 cents to the government.

there is not a corporate tax or payroll tax and there is not a capital gains tax.

I've read something about this proposal in the past and i think it's more fair then a straight flat tax, though it is kinda what it is. I like the idea, of giving a set amount of money per month based on the poverty level for your family size. would this essential money be given to all regardless of income, or just those below the poverty level already? Or something different? I'd say regardless, so even if you make a million bucks a year and you are a family of 3( I like using family of 3 cause 20,000 is easy for me to use math on) approx 1,666 a month would be given for essentials. Then you pay 23% on all goods and services. But I think your idea is actually a tax on business. 10.00, but send 23% away. Or am i doing this wrong?

 

[ludin]

I've read something about this proposal in the past and i think it's more fair then a straight flat tax, though it is kinda what it is. I like the idea, of giving a set amount of money per month based on the poverty level for your family size. would this essential money be given to all regardless of income, or just those below the poverty level already? Or something different? I'd say regardless, so even if you make a million bucks a year and you are a family of 3( I like using family of 3 cause 20,000 is easy for me to use math on) approx 1,666 a month would be given for essentials. Then you pay 23% on all goods and services. But I think your idea is actually a tax on business. 10.00, but send 23% away. Or am i doing this wrong?

it doesn't matter if you make 1m or 10k if you have a family of 4 you both receive the same amount granted I am sure it could be faded out for people over say 1m dollars a year or something.

Businesses like they do now pay the sales tax, but it isn't an additional item on the receipt the tax is already included in the price of the item.

So if you come into my shop and purchase 10 dollars worth of stuff I will owe 2.30 to the government. now what is cool is that I can be a tax collection (I already do) for the sales tax additional tax rebate on the amount of tax I collect.

the cool thing for businesses is that they know exactly what tax they will pay because is it based on sales and service. the other thing is that as a company I know longer have to pay payroll taxes or anything else so I am actually saving money.

it is a tax on goods but the business ends up sending the money to the government. just like they do now on normal sales tax.

the thing is that the tax is only on new goods and services. so if you buy or sell a used car you don't have to pay the tax on it. if you buy or sell an old home you don't have to pay the tax on it.

the builder that wants to build the house doesn't have to pay tax on any of the material to build the new home he just has to pay the tax on the finished product same with any other manufacturing goods.

it won't hurt businesses because the sales tax is already included in the price of the item. so if I so 10k in sales I already collected the 2,3k that I have to send to the government.
basically it means that people can control exactly the amount of tax they pay. it also helps lower income people since they pay zero tax up to the poverty level.

 

[Steve Ja]

it doesn't matter if you make 1m or 10k if you have a family of 4 you both receive the same amount granted I am sure it could be faded out for people over say 1m dollars a year or something.

Businesses like they do now pay the sales tax, but it isn't an additional item on the receipt the tax is already included in the price of the item.

So if you come into my shop and purchase 10 dollars worth of stuff I will owe 2.30 to the government. now what is cool is that I can be a tax collection (I already do) for the sales tax additional tax rebate on the amount of tax I collect.

the cool thing for businesses is that they know exactly what tax they will pay because is it based on sales and service. the other thing is that as a company I know longer have to pay payroll taxes or anything else so I am actually saving money.

it is a tax on goods but the business ends up sending the money to the government. just like they do now on normal sales tax.

the thing is that the tax is only on new goods and services. so if you buy or sell a used car you don't have to pay the tax on it. if you buy or sell an old home you don't have to pay the tax on it.

the builder that wants to build the house doesn't have to pay tax on any of the material to build the new home he just has to pay the tax on the finished product same with any other manufacturing goods.

it won't hurt businesses because the sales tax is already included in the price of the item. so if I so 10k in sales I already collected the 2,3k that I have to send to the government.
basically it means that people can control exactly the amount of tax they pay. it also helps lower income people since they pay zero tax up to the poverty level.

So you propose eliminating social Security and medicare?
Just new goods.. hmm do you have any stats to say how much revenue a 23% consumption tax would bring in this way? The consumption tax plan I read included all goods and services, so it would be a % of gdp. So if GDP was 16 trillion 23% of that is aprox 2.5 trillion

 

[Real Korimyr #9]

Picture a corporation as being like a complicated machine. There's a big slot in the top where you pour money in, and then a big slot at the bottom where more money falls out.

If the government taxes the money before you put it into the machine, and then taxes it again when it comes out of the machine, what sense does it make for the government to try to get more money by taxing it in the middle?

 

[cpwill]

If the government taxes the money before you put it into the machine, and then taxes it again when it comes out of the machine, what sense does it make for the government to try to get more money by taxing it in the middle?

 

[iguanaman]

I personally think that our current tax system is to antiquated.

I truely believe in taxing consumption over wages. which is why i fall more into the fair tax plan. You basically don't pay taxes up to the poverty level based on family size.
so a family of 4 would get 559 a month to spend on basic essentials, food, utilities etc. other than that you pay a 23% inclusive tax on any new item and service you get.

what is meant by inclusive. the tax is already in the price of the item. so if you buy something for 10 dollars you pay 10 dollars. the company then sends 2.30 cents to the government.

there is not a corporate tax or payroll tax and there is not a capital gains tax.

You tax something you want less of and you choose consumption? We need to tax money NOT spent if we want growth in a consumer economy. A lower bracket tax cut paid for with a new over a million dollar income bracket with a rate of 50% would do that nicely.

 

[MTAtech]

1. We would not see a direct $300 Bn loss, as the beneficial economic activity would drive other sources of revenue up. I'm not saying they would replace the full $300 Bn within one tax year, only that they would mitigate the loss of Corporate taxes as a form of federal income, and that that mitigation would become heavier the further out you move in time.

2. We would become a tax shelter for the rest of the world. Businesses from all over would want to set up here, with beneficial results for our population.

3. We should treat dividends as regular income, as it would no longer be subject to double taxation. Treating capital gains the same way would help mitigate the original loss of revenue as well, though, again, not nearly as much as you would expect from a static score.

1. There is no empirical evidence to support the assertion that "economic activity would drive other sources of revenue up."

2. There is no empirical evidence to support the assertion that the U.S. would become a tax shelter for the rest of the world. There already are countries that have no corporate taxation but one still must pay taxes on earnings offshore. With the U.S. and Europe becoming so strict with enforcement, offshoring is quickly becoming a relic of the wealth-management past.

3. Taxing capital gains at the same rate as ordinary income would bring in billions but we should do that anyway, as there is no reason to give preference to one form of income over another. In this case we currently give preference to capital gains, which are largely earned by the top 1% than to income earned by wages.

 

[MTAtech]

I personally think that our current tax system is to antiquated.

I truely believe in taxing consumption over wages. which is why i fall more into the fair tax plan. You basically don't pay taxes up to the poverty level based on family size.
so a family of 4 would get 559 a month to spend on basic essentials, food, utilities etc. other than that you pay a 23% inclusive tax on any new item and service you get.

what is meant by inclusive. the tax is already in the price of the item. so if you buy something for 10 dollars you pay 10 dollars. the company then sends 2.30 cents to the government.

there is not a corporate tax or payroll tax and there is not a capital gains tax.

There is nothing fundamentally antiquated about the progressive tax system. Most Americans would agree that there should be an upward marginal income tax. I think that we don't have enough brackets and there should be no distinction between capital gains and ordinary income.

 

[ludin]

So you propose eliminating social Security and medicare?
Just new goods.. hmm do you have any stats to say how much revenue a 23% consumption tax would bring in this way? The consumption tax plan I read included all goods and services, so it would be a % of gdp. So if GDP was 16 trillion 23% of that is aprox 2.5 trillion .

the fair tax repeals all payroll taxes. so whatever you earn you bring home.

the first year it is revenue neutral meaning that it should bring in the same amount as previous. years after it is expected to grow due to increased economic activity.

You tax something you want less of and you choose consumption? We need to tax money NOT spent if we want growth in a consumer economy. A lower bracket tax cut paid for with a new over a million dollar income bracket with a rate of 50% would do that nicely. .

consumption is a much more consistant thing to tax than payroll. by taxing consumption and allowing people to bring home everything that they make you expand the tax base people won't see the tax since it is inclusive of the item. it isn't that you check out and see 10 with a line item 2.30 federal sales tax. you pay 10 dollars and that is it.

no more tax brackets just complicated an already complicated system. when the IRS doesn't know all the rules in the tax code there is a major issue.
taxing people at 50% of their income is stupid. they already know how to hide that money and will do so.

1. There is no empirical evidence to support the assertion that "economic activity would drive other sources of revenue up."

Where do you think taxes come from anyway? it is economic activity
So there is tons of empirical evidence that shows economic activity drives up revenues.

2. There is no empirical evidence to support the assertion that the U.S. would become a tax shelter for the rest of the world. There already are countries that have no corporate taxation but one still must pay taxes on earnings offshore. With the U.S. and Europe becoming so strict with enforcement, offshoring is quickly becoming a relic of the wealth-management past.

the only way the US can tax offshore earnings is if they bring it into the US.
I never said they would become a tax shelter.

companies will come here though. It doesn't make economic sense to tax corporations heavily and then expect them to create jobs and everything else.

. Taxing capital gains at the same rate as ordinary income would bring in billions but we should do that anyway, as there is no reason to give preference to one form of income over another. In this case we currently give preference to capital gains, which are largely earned by the top 1% than to income earned by wages.

no it wouldn't it would discourage investment. there is no reason to invest if 40% of what i make i have to hand over to the government. that is just stupid.
yes because we incourage business investment it is what keeps the economy going and moving.

There is nothing fundamentally antiquated about the progressive tax system. Most Americans would agree that there should be an upward marginal income tax. I think that we don't have enough brackets and there should be no distinction between capital gains and ordinary income. .

it is 100 years old that is antiquated. most americans feel they are taxed to much.
more brackets means more complications and increased expense in enforcement.

cool so you own a home bought a home and sold your home for 100k profit you now owe the government 40% of that. way to go you just killed any and all home sales. you killed any type of investment incentive out there. econonmic suicide.

 

[274ina]

LMAO!!!!!

OMG!!!! what a farse!!

Thye pay nothing in taxes and make all the money, and we pay all the taxes and get no money!

 

[Neomalthusian]

What do you think the impact would be of eliminating Corporate taxes?

It depends on what type of tax we might use to make up for the lost revenue from eliminating the corporate tax. According to the link below, the revenue lost would only be two-thirds of the total average annual revenues from corporate taxes, because the absence of the corporate tax would increase economic activities that would make up for some of it. The other two-thirds should be made up by either income or consumption taxes. If consumption taxes, the simulation of this proposal results in welfare gains across all income levels. In other words, according to the study below, the elimination of the corporate tax with revenue made up for with a consumption tax would ultimately (even if counterintuitively) make Americans significantly better off.

In the event you don't pick up what I'm laying down, read this:

http://www.ncpa.org/pdfs/Simulating_the_Elimination_of_the_U.S._Corporate_Income_Tax.pdf

 

[jaeger19]

What do you think the impact would be of eliminating Corporate taxes? On the economy on wages, on employment... How should we make up for the lost revenue of around $300 billion? Make the capital gains taxes the same as income taxes? Cut spending? and on what programs? Will there be less revenue overall, or will it actually result in more revenues through increased wages and employment. I'd like to see what everyone is thinking on this subject.

I personally Would like to see it eliminated all together. I think it will actually result in increased revenues for the government through more employment as companies will have more to spend. Also will result in companies spending more money on research, and expansion. Results more revenues.

If you eliminated corporate taxes... US tax revenue would drop exponentially. Because then corporations would become giant holding companies that would hold money over free of taxes. Business folks like myself would rush to form C corporations to take advantage of that huge loophole (as we used to do..)

You would not see any increase in business investment... because you already pay tax only on the money that you've decided to NOT invest back into your company. If you take money that you made and put it back into your company.. you don't pay taxes on it already.

If anything, you may see a decrease in business development because there would be no incentive to upgrade facilities, replace equipment etc, in good fiscal years (to take advantage of depreciation).

 

[Steve Ja]

If you eliminated corporate taxes... US tax revenue would drop exponentially. Because then corporations would become giant holding companies that would hold money over free of taxes. Business folks like myself would rush to form C corporations to take advantage of that huge loophole (as we used to do..)

You would not see any increase in business investment... because you already pay tax only on the money that you've decided to NOT invest back into your company. If you take money that you made and put it back into your company.. you don't pay taxes on it already.

If anything, you may see a decrease in business development because there would be no incentive to upgrade facilities, replace equipment etc, in good fiscal years (to take advantage of depreciation).

Interesting post. Excellent point for being against it

 

[ludin]

If you eliminated corporate taxes... US tax revenue would drop exponentially. Because then corporations would become giant holding companies that would hold money over free of taxes. Business folks like myself would rush to form C corporations to take advantage of that huge loophole (as we used to do..)

You would not see any increase in business investment... because you already pay tax only on the money that you've decided to NOT invest back into your company. If you take money that you made and put it back into your company.. you don't pay taxes on it already.

If anything, you may see a decrease in business development because there would be no incentive to upgrade facilities, replace equipment etc, in good fiscal years (to take advantage of depreciation).

No it wouldn't because corporations don't pay taxes anyway. Any tax on a corporation is passed on to the customers. when you buy something from a store all the taxes and other things are put onto that item already.

so if i am a widget maker. i don't pay payroll taxes that is a huge benefit to me and my employee's. I don't have to pay taxes on material used to make my widgets so my costs go down. i sell my widgets for 20 dollars 40 dollars and 60 dollars.

in one month i sell 20 small widgets for a total of 400
i sell 40 medium widgets for 1600 dollars
and i sell 50 large widgets for 3000.

that is a total of 5000 dollars. i would need to send the federal government 1,150 dollars in tax. the other 3,850 is used for whatever else.
i see no impact because i am no longer paying payroll taxes and no tax on material used to make my widgets. the only impact i see is when sell a new widget.

lets say i have a refining process that i can salvage widgets. since they are used i can sell them at a discount and i pay no tax on those.

this means more profit for my comany but it also means that i can do other things like expand and pay better wages.

 

[jaeger19]

A few thoughts on the fair tax...

the fair tax repeals all payroll taxes. so whatever you earn you bring home.

the first year it is revenue neutral meaning that it should bring in the same amount as previous. years after it is expected to grow due to increased economic activity.

Just to point out.. they have tried consumptive taxes and they find that economic activity doesn't increase... because you pay a penalty on consumption.. and you can control that penalty by not buying things.

A tax was tried on luxury yachts years ago and it killed the American ship builders.

cool so you own a home bought a home and sold your home for 100k profit you now owe the government 40% of that. way to go you just killed any and all home sales. you killed any type of investment incentive out there. econonmic suicide

Except, now, if I buy another home with that 100k profit.. I don't pay tax..

Under your plan.. I would pay 23% on the home I buy.

no more tax brackets just complicated an already complicated system. when the IRS doesn't know all the rules in the tax code there is a major issue.
taxing people at 50% of their income is stupid. they already know how to hide that money and will do so.

If you think that's complicated.. wait until you try to calculate all the sales taxes on consumption. and do you do multiple taxes? Every time something is sold? And every service?

 

[jaeger19]

No it wouldn't because corporations don't pay taxes anyway. Any tax on a corporation is passed on to the customers. when you buy something from a store all the taxes and other things are put onto that item already.

Except that's not true.. it couldn't be. Think about it.. how do you pass on corporate income tax? You make a profit, and have to pay 35% tax,, so you jack up prices (passing it on to the consumer) and that means you make MORE money.. which means that has to be taxed at 35% so you jack up prices... in essence.. prices would never stabilize.

Taxes do not all get folded into prices... that's because what people are willing to pay for a product is not based on the taxes.. its based on total cost.. and if it costs to much.. people will not buy it.. they won't simply shrug and pay the added price.

that is a total of 5000 dollars. i would need to send the federal government 1,150 dollars in tax. the other 3,850 is used for whatever else.
i see no impact because i am no longer paying payroll taxes and no tax on material used to make my widgets. the only impact i see is when sell a new widget.

lets say i have a refining process that i can salvage widgets. since they are used i can sell them at a discount and i pay no tax on those.

this means more profit for my comany but it also means that i can do other things like expand and pay better wages.

Except that before you could have anyway... because your are taxed only on profit..and if you put more money into your company. then you wouldn't pay tax on that money.

.

 

[ludin]

A few thoughts on the fair tax...



Just to point out.. they have tried consumptive taxes and they find that economic activity doesn't increase... because you pay a penalty on consumption.. and you can control that penalty by not buying things.

A tax was tried on luxury yachts years ago and it killed the American ship builders.

That is called a VAT tax. that doesn't repeal current income taxes it is an inclusion of those taxes it is the same reason that the luxery tax failed as well.
the fair tax eliminates all current payroll and income taxes.

Except, now, if I buy another home with that 100k profit.. I don't pay tax..

Under your plan.. I would pay 23% on the home I buy.

only if it is new. even then you wouldn't see it as it is inclusive not exclusive.
The Fairtax Calculator

is a better explination.

If you think that's complicated.. wait until you try to calculate all the sales taxes on consumption. and do you do multiple taxes? Every time something is sold? And every service?

It isn't that hard to understand.
if you buy 100 dollars worth of times. you pay 100 dollars. the company will then send 23 dollars on the collection date to the government.

companies already calculate sales tax.

 

[Fenton]

What do you think the impact would be of eliminating Corporate taxes? On the economy on wages, on employment... How should we make up for the lost revenue of around $300 billion? Make the capital gains taxes the same as income taxes? Cut spending? and on what programs? Will there be less revenue overall, or will it actually result in more revenues through increased wages and employment. I'd like to see what everyone is thinking on this subject.

I personally Would like to see it eliminated all together. I think it will actually result in increased revenues for the government through more employment as companies will have more to spend. Also will result in companies spending more money on research, and expansion. Results more revenues.

You and I agree, and lower Capital Gain taxes while your'e at it. Countries like Switzerland, Sweden and Denmark have lower Corporate taxes than the US and they generally incentivize wealth creation, even though they're the "go to example of Progressive paradises" for many left wing poster here, they have strong free market economies with a small population.

Even Clinton had the sense to lower capital gains taxes.

An increase in Corporate taxes is a tax on the consumer basically.

 

[Bigfoot 88]

Businesses don't pay taxes; consumers do in the form of higher prices.

Only the economically illiterate and politically cunning support business taxes.

 

[TurtleDude]

I personally think that our current tax system is to antiquated.

I truely believe in taxing consumption over wages. which is why i fall more into the fair tax plan. You basically don't pay taxes up to the poverty level based on family size.
so a family of 4 would get 559 a month to spend on basic essentials, food, utilities etc. other than that you pay a 23% inclusive tax on any new item and service you get.

what is meant by inclusive. the tax is already in the price of the item. so if you buy something for 10 dollars you pay 10 dollars. the company then sends 2.30 cents to the government.

there is not a corporate tax or payroll tax and there is not a capital gains tax.

It also removes the extra constitutional power congress grabbed with the odious income tax scheme

you can no longer pander to the many by promising them free stuff paid for by tax hikes on the few

 

[TurtleDude]

You tax something you want less of and you choose consumption? We need to tax money NOT spent if we want growth in a consumer economy. A lower bracket tax cut paid for with a new over a million dollar income bracket with a rate of 50% would do that nicely.

ah the classic screw the rich class warfare nonsense that the left spews all the time

how about everyone pay the same rate so the pimps in office cannot pander to people like you by appealing to your hatred of those more successful than you with higher taxes on the most industrious?