The Tax Foundation--at it again with bunk about overtaxed

The Tax Foundation--an organization that claims bipartisanship but these days seems to be a shill for corporate managers and owners--is at it again, claiming that US businesses "are paying the second-highest corporate tax rate in the world..."

The Tax Foundation knows that the US statutory tax rates (set at 35% for the biggest corporations, but at much lower rates for the majority of corporations that have less than $10 million in assets) are not paid on the full amount of income by corporations, and in fact the effective tax rates (amount of tax paid as a percentage of income earned) are much much lower--enough lower so that the US counts as a tax haven on the tax rates scale.

Further, the US taxes for US businesses are plenty competitive. Taxes are most likely not the reason they go abroad: it seems to be much more likely that they do so to get away with paying their workers near slave-labor wages rather than enough for a decent standard of living. And even that isn't passed on to customers--it provides the moolah to pay managers ridiculously high salaries and pay rent dividends to shareholders.

Moreover, tax cuts for corporations don't really create jobs. If they did, we wouldn't have had the great recession, since the Bush tax bills included a whole smorgasboard of tax cuts for businesses, including the infamous "American Jobs Creation Act of 2004" that cut corporate rates (almost tax-free repatriation of foreign-earned income, manufacturing deduction that lowered the corporate rate for most US industries, all kinds of tax expenditures for extractive industries, various changes to subpart F that favored corporate taxpayers, bonus depreciation, etc.). If tax cuts for businesses worked, those bills should have resulted in millions upon millions of new jobs. Instead, it looks like most of the benefit of the low-taxed repatriation of profits went to stock buybacks and other manager/owner-friendly provisions, not job creation. IN fact, as pointed out in earlier postings, many of the corporations employing the low-taxed repatriation laid off workers! So much for tax cuts as a way to create jobs.....

http://angrybear.blogspot.com/2010/02/tax-foundation-at-it-again-with-bunk.html#more

On a broad tangent: Have you heard about the .01 tax on every stock transaction? Regressive in a way, but can't really hurt, 10 cent fee on every thousand? Billions generated...

though i'm guessing it would hit small day-traders harder than big ones (depending on what 'each trade' means). but it would also reduce the fees wall street generates on trades - good in my book.

definitely seems reasonable, I'm wondering how much the small day traders spend as a whole? Wouldn't imagine it'd be more than a couple bucks tax a day...then again I am not financially minded, in fact I'd say I have a disability in figuring out how this works. Might be good, keeps me from investing, much like my allergy to morphine guarantees I'll never be a junkie! ;)

Thanks for your post. If I had a gold star, I would give it to you. Unfortunately I just filed my income taxes. Ouch! The lower area of my middle class sure does hurt right now. ;)

K&R for a great post.:kick:

The article mentions the so-called Jobs Creation Act of 2004. Surprise! All those tax breaks just went into the pockets of those at the top. In Oregon, we finally decided to update the corporate tax structure for the first time since the 1930s, and bump the tax rate on income above $250,000. We've been told that it will leave the state a desolate wasteland, bereft of jobs and industry, and all the rich people will leave.

I wonder what might happen if the state has more money on hand to improve the schools, keep up roads and bridges, and modernize the electric grid and major sewage systems? Might look like a pretty attractive place to businesses and individuals who like these kinds of amenities.

That's great that they did that...somebody human in charge there...

Which, considering the factors involved wasn't too bad. One of the griping points for the anti-tax crowd was how underhanded the legislature had been in bringing the ballot measures to a vote. Of course, they completely left out their own connivance in that. The legislature probably could have passed the taxes on its own, but the anti-tax crowd threatened to circulate a petition to put it on the ballot, so the legislature simply made the referral itself.

There was a pretty organized campaign on both sides, but the anti crowd distinguished itself once again with its dishonesty. Ad after ad and letter after letter in the local papers all hit on the idea that this was a class warfare move that amounted to that most despicable (in Oregonian eyes) of taxes, the dreaded sales tax. I reckon the campaign was effective in its own way, but ultimately unsuccessful. It's been about two weeks, and the highways out of state don't seem to be overly congested with fleeing millionaires.

believe him, however. we'll see.

Then, on February 1, 2011, ask him how business is. Then give him back the slip of paper.