[dante]

So watching the Jon Stewart piece from (last night?) and it got me wondering: why don't all of the brain-dead flat-tax/fair-tax people push for a flat CORPORATE tax rate of say..... 20%? They're so willing to push for a 20% personal flat tax rate (even though the vast majority of middle and lower-class Americans pay far, far, far less), but why not a 20% corporate flat tax rate? It would benefit small businesses (who usually have to pay at a higher rate with little/no deductions or financial shicanery), and would ease the accounting burden on corporations. Granted, it would mean that a company like GE would get hit with a $3 billion tax bill instead of a $2.5b tax *handout*, but those are the breaks.

Thoughts? I'm guessing we don't hear much because a lot of big, powerful companies would have to pay a WHOLE lot more, but I'm wondering whether that's just because of the .

 

[Dartman]

They already have a corporate flat tax rate.

0.00%.

 

[Westy]

You are using logic, pointless as it will never happen.

 

[stoney]

I wouldn't disagree, the one thing that needs to be accounted for is watching them move offshore like Haliburton did. The only way it could work would be to anchor the companies to the US if they wish to bid on any US Govt contract. However, more business and manufacturing would just be moved offshore. And even if companies were charged at 20% tax rate, they would just mark up bids for govt contracts by that amount.
It's counter productive no matter how you look at it.

What I would like to see is the Army Corps of Engineers get back into the infrastructure business. There is no profit motivation to do it for the cheapest amount possible, your incentive is to do it right so you don't need to come back and do it again. This is a catch22 though. The only way this will work is if the work docket is deep enough to keep them busy for a long time. I would MUCH rather see the Corps doing infrastructure building rather than private companies.

Maybe it's just my area, but the infrastructure work done by private companies is pretty shoddy. The only exception I have seen to this was the section of 580 that melted after a gas truck blew up underneath it. The company was incentivized by $100k/day (pos and neg) if they took more than 45 days; this was also bonded to last 15 years. If it doesn't, the company owners are on the hook for the repair costs. They finished it in 29 days, and it's the smoothest stretch of highway for 10 miles each way. It clearly looks to be higher quality than the surrounding bridges.

 

[Silver]

Doesn't help-the hard part is coming up with the net income amount.

 

[TheMontashu]

I wouldn't disagree, the one thing that needs to be accounted for is watching them move offshore like Haliburton did. The only way it could work would be to anchor the companies to the US if they wish to bid on any US Govt contract. However, more business and manufacturing would just be moved offshore. And even if companies were charged at 20% tax rate, they would just mark up bids for govt contracts by that amount.
It's counter productive no matter how you look at it.

What I would like to see is the Army Corps of Engineers get back into the infrastructure business. There is no profit motivation to do it for the cheapest amount possible, your incentive is to do it right so you don't need to come back and do it again. This is a catch22 though. The only way this will work is if the work docket is deep enough to keep them busy for a long time. I would MUCH rather see the Corps doing infrastructure building rather than private companies.

Maybe it's just my area, but the infrastructure work done by private companies is pretty shoddy. The only exception I have seen to this was the section of 580 that melted after a gas truck blew up underneath it. The company was incentivized by $100k/day (pos and neg) if they took more than 45 days; this was also bonded to last 15 years. If it doesn't, the company owners are on the hook for the repair costs. They finished it in 29 days, and it's the smoothest stretch of highway for 10 miles each way. It clearly looks to be higher quality than the surrounding bridges.

Good thing GE doesn't provide infrastructure. They are the second largest defense contractor, largest finance company, and they run one of the largest news outlets in the country. We give them tax breaks and no bid contracts. It's corporate welfare joker plain and simple. Now I don't know about you, but if we are going to be handing out welfare we should be handing it to people who want to buy food and not another jet........

How about we stop letting soft money run the country, and we stop letting corporate interests run the country, and we make the rich scumbags who are doing so well, (go do some research into wealth inequities and how the ultra-rich are doing financially) pay there taxes.

 

[stoney]

Good thing GE doesn't provide infrastructure. They are the second largest defense contractor, largest finance company, and they run one of the largest news outlets in the country. We give them tax breaks and no bid contracts. It's corporate welfare joker plain and simple. Now I don't know about you, but if we are going to be handing out welfare we should be handing it to people who want to buy food and not another jet........

How about we stop letting soft money run the country, and we stop letting corporate interests run the country, and we make the rich scumbags who are doing so well, (go do some research into wealth inequities and how the ultra-rich are doing financially) pay there taxes.

I don't know where to start with this one... What are train locomotives? What about wind turbines? Heavy machinery? Oh, they are all parts of infrastructure. I was using it as a specific example of somethign that is better run by govt.

As for the tax issues, let's see you propose a better method that doesn't see them moving offshore. I'm not going to argue this with you, as you can't remove emotion and disdain for those better off than yourself from any argument you make.

But from a pure business standpoint, what is the benefit to me if I can get cheaper labor in another country? If I am getting taxed higher in my current locale than I would be elsewhere and that elsewhere has cheaper labor, why should I stay?

There must be some incentive to keep the business in the US. Look up GE's payroll and take 20% of that. You can assue that amount is income taxes paid by individuals. THAT is the tax that is generated by big corps. The taxes paid by their employees, who are paid such that their jobs compensate for the taxes paid.

Don't like it, but understand the catch-22.

 

[stevew]

i hear GE has made their employees really happy with their healthcare......

 

[stoney]

i hear GE has made their employees really happy with their healthcare......

Dancing worldwide?

 

[TheMontashu]

I don't know where to start with this one... What are train locomotives? What about wind turbines? Heavy machinery? Oh, they are all parts of infrastructure. I was using it as a specific example of somethign that is better run by govt.

As for the tax issues, let's see you propose a better method that doesn't see them moving offshore. I'm not going to argue this with you, as you can't remove emotion and disdain for those better off than yourself from any argument you make.

But from a pure business standpoint, what is the benefit to me if I can get cheaper labor in another country? If I am getting taxed higher in my current locale than I would be elsewhere and that elsewhere has cheaper labor, why should I stay?

There must be some incentive to keep the business in the US. Look up GE's payroll and take 20% of that. You can assue that amount is income taxes paid by individuals. THAT is the tax that is generated by big corps. The taxes paid by their employees, who are paid such that their jobs compensate for the taxes paid.

Don't like it, but understand the catch-22.

I understand that it's cheaper to do business over seas, that's why we need protectionist trade policies that penalize overseas production and such. As well as tax breaks for ACTIALLY creating jobs, it's really pretty simple, lots of countries do it.

You really need to get of Milton Friedman's nuts dude, the guy is full of crap.

 

[stevew]

Dancing worldwide?

not.....

 

[dante]

You really need to get of Milton Friedman's nuts dude, the guy is full of crap.

Maybe your horrendous spelling *isn't* a sign of complete stupidity. Even with the misspelling above, you're showing that you might actually be wise far beyond your years...

 

[Pesqueeb]

Maybe your horrendous spelling *isn't* a sign of complete stupidity. Even with the misspelling above, you're showing that you might actually be wise far beyond your years...

I'd make another crack about the statistical probability of Mooshoo saying something smart, but twice inside of 6 months? Maybe our little retard is actually growing up. I almost want to cry I'm so happy.

 

[dante]

^^^ I guess we'll know which it is if Mooshoo randomly spits out a copy of Romeo and Juliet?

 

[ridiculous]

We have the biggest consumer market in the world. Seems sad that we cant have a flat tax for doing business here irrespective of where the business is located and have perks for businesses that do use domestic labor and materials. No idea what those perks are.

 

[TheMontashu]

I'd make another crack about the statistical probability of Mooshoo saying something smart, but twice inside of 6 months? Maybe our little retard is actually growing up. I almost want to cry I'm so happy.

How could I not know about him?? Him and his buddies have been doing all they can to sell out the middle class and help the rich, since well, Regan. One of Regan's advisers even admitted they ruined the economy (I think I saw that on here actually) Thanks to people like freedman we have seen the largest shift in wealth distribution the US has ever seen, and the middle class is still sitting at roughly the same income it was in like the 70's.

^^^ I guess we'll know which it is if Mooshoo randomly spits out a copy of Romeo and Juliet?

I can do that, my last name is after all Montague

 

[stevew]

well...he spelled friedman right the first time.

 

[Silver]

We have the biggest consumer market in the world. Seems sad that we cant have a flat tax for doing business here irrespective of where the business is located and have perks for businesses that do use domestic labor and materials. No idea what those perks are.

It's the net income number.

I've said this a million times, and I'll say it again. A flat tax solves nothing and saves nothing. You pay the accountant to come up with the net income, not the tax owed.

Example: Body shop and fine art photographer. Let's pretend that equipment costs are already spoken for to make it simple. Body shop does $3k of work on a car damaged in an accident. They spent $1500 on parts-the rest is labor and profit. Photographer sells a print for $3000. His costs for film and the print are $500.

They both have $3000 of gross income. A flat tax with no deductions, they both pay the same income tax. They clearly didn't make the same amount of money.

Now, I know someone out there is saying, "I didn't mean a flat tax. I meant a VAT...yeah, that's it!" Well then, stop advocating for a flat tax

 

[Silver]

well...he spelled friedman right the first time.

Even Reagan in the last couple years of his presidency couldn't spell his name correctly. As long as Mooshoo isn't waddling around in a diaper with his finger on the nuclear button, I'll take what I can get.

 

[ohio]

They both have $3000 of gross income. A flat tax with no deductions, they both pay the same income tax. They clearly didn't make the same amount of money.

Maybe I'm missing something, but the only flat tax I've ever seen anyone (including me) advocate for in the context of corporate taxes is on profit (~net income).

 

[dante]

Maybe I'm missing something, but the only flat tax I've ever seen anyone (including me) advocate for in the context of corporate taxes is on profit (~net income).

Well, what I think that Silver is conflating is purchases for personal use (ie, NOT counted as a "cost" that affects net profit) and purchases for business use (ie, it DOES count as a cost that affects net profit). So:

1) I make $100k, I spend $75k on stuff. For a flat-tax, I pay taxes on the $100k. (personal flat tax)
2) My company makes $100k, and my company spends $75k on inventory, rent and personnel. My company pays tax on the $25k, NOT on the $100k. (corporate flat tax)

I don't know how to make it work so that it would just tax the revenue as opposed to profit because some companies are high-margin, low sales companies, and others are low-margin, high sales companies. I just know that GE reported $14b+ in profits, and yet got a tax refund.

 

[Silver]

Maybe I'm missing something, but the only flat tax I've ever seen anyone (including me) advocate for in the context of corporate taxes is on profit (~net income).

That's great, but you're not changing anything-tax rates for corporations that make more than a few hundred thousand are already effectively flat.

And you don't save any work-what you do end up doing is trading a lower rate for the hope that lobbyists stop buying loopholes. I've seen how that movie works already with healthcare reform.

And do you end up broadening the tax base-or do you end up with GE buying more executive jets and Wall Street spending $75k on trash bins for c-level offices? Both are business expenses, right?

 

[ohio]

That's great, but you're not changing anything-tax rates for corporations that make more than a few hundred thousand are already effectively flat.

The nominal rate is flat, but the effective rate is highly variable thanks to massive numbers of loopholes, incentives, penalties, and deductions (from profit). GE's effective rate (according to zero hedge) was "between 2002 and 2009, during which timeframe the firm made a generous $164.4 billion in pretax net income (not to mention $639 billion in domestic revenue, just over half of total revenues of $1.2 trillion) it paid only $5 billion in domestic current taxes, or a 3.17% tax rate!"

What I'm referring to (and what I infer from others that suggest a "flat" corporate tax) is an elimination of modifications to net income prior to calculating tax.

 

[syadasti]

 

[Pesqueeb]

^^^^^^^^^^^Trolling facebook with that exact image. LULZ will be had.

 

[syadasti]

^^^^^^^^^^^Trolling facebook with that exact image. LULZ will be had.

If they put a bit more effort into it, they could have had a much bigger number. A random selection of 4 doesn't really show the scope of the issue. They could also point out that Reagan didn't tolerate tax cheats like GE...