I challenge all of those against this to learn what tax incidence is and how it applies to the corporate tax rate
Trump Wants Tax Plan to Cut Corporate Rate to 15%
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Re: Trump Wants Tax Plan to Cut Corporate Rate to 15%
#12The thing that most people fail to realize is that a lower corporate tax rate helps the overall enconomy and all Americans. Companies now suddenly have increased capital to spend on growth (hiring, R&D, and acquisitions). Additionally it boost earnings which will likely increase most people's retirement accounts and stock portfolios. Typical that I'm getting downvoted without any rebuttal.
How much of the capital would realistically go to those, as opposed to shareholder payouts?
One of the arguments for lower corporate taxes is to move the taxation to the shareholders.
Re: Trump Wants Tax Plan to Cut Corporate Rate to 15%
#13Re: Trump Wants Tax Plan to Cut Corporate Rate to 15%
#14Paul Krugman on Tax Cuts: "Zombies of Voodoo Economics" https://www.nytimes.com/2017/04/24/opinion/zombies-of-voodoo...
Re: Trump Wants Tax Plan to Cut Corporate Rate to 15%
#150%, with raises to capital gains to offset the tax revenue, would be better, but I can understand it's politically infeasible (because people are ignorant). Better than nothing.
Re: Trump Wants Tax Plan to Cut Corporate Rate to 15%
#16The thing that most people fail to realize is that a lower corporate tax rate helps the overall enconomy and all Americans. Companies now suddenly have increased capital to spend on growth (hiring, R&D, and acquisitions). Additionally it boost earnings which will likely increase most people's retirement accounts and stock portfolios. Typical that I'm getting downvoted without any rebuttal.
Hasn't this sentiment been repeatedly disproven in practical applications since at least Reagan?
Re: Trump Wants Tax Plan to Cut Corporate Rate to 15%
#17The thing that most people fail to realize is that a lower corporate tax rate helps the overall enconomy and all Americans. Companies now suddenly have increased capital to spend on growth (hiring, R&D, and acquisitions). Additionally it boost earnings which will likely increase most people's retirement accounts and stock portfolios. Typical that I'm getting downvoted without any rebuttal.
How much of the capital would realistically go to those, as opposed to shareholder payouts?
Only a small percentage of companies are public and have CEOs making giant bounces off of tax cuts.
This worldview that Bernie Sanders esque people hold, where every business person is a rich multi millionaire, ignores the reality of business... where the vast majority are small and medium sized businesses.
The critique of George Bush's temporary tax credit was that it was used as bonuses rather than stimulating the economy. But a long term tax reduction is something you can actually plan for with expenditures like R&D. I've seen many people comparing the two disingenuously like they are the same. They aren't, that's not how business finance works.
There have also been a number of examples in history where reducing the tax rate has actually increased tax revenue as companies are much more productive and more capital is available to invest in industry.
The more revenue companies generate the more taxable income there is both from the company revenue and the incomes of employees they hire.
Re: Trump Wants Tax Plan to Cut Corporate Rate to 15%
#18Lower corporate taxes can also help create structures which allow wealthier people to avoid taxes.
For example, if you can create a structure in which all of your consulting income + capital-asset income goes into a C-corp, and you pay most of your own expenses through the C-corp (e.g., Trump tower home office), then you can keep most of your income taxed at only 15%. The C-corp holds it forever, and pays your expenses, and pays you a small salary for non-expensable items. The C-corp can purchase things like corporate cars, boats, airplanes, and real-estate, and pay for trips as well.
Obviously, there is administrative overhead in setting these things up; you can't be earning 150k and trying to pull this off.
There cannot be a gap between C-corp taxation and individual taxation rates if you want to avoid creating more loopholes for wealthier people---especially those who earn mostly from their capital assets.
Re: Trump Wants Tax Plan to Cut Corporate Rate to 15%
#19The thing that most people fail to realize is that a lower corporate tax rate helps the overall enconomy and all Americans. Companies now suddenly have increased capital to spend on growth (hiring, R&D, and acquisitions). Additionally it boost earnings which will likely increase most people's retirement accounts and stock portfolios. Typical that I'm getting downvoted without any rebuttal.
Awesome. Let's cut it down to 0%.
Why did you remove "snowflakes" from your post?
Re: Trump Wants Tax Plan to Cut Corporate Rate to 15%
#20The thing that most people fail to realize is that a lower corporate tax rate helps the overall enconomy and all Americans. Companies now suddenly have increased capital to spend on growth (hiring, R&D, and acquisitions). Additionally it boost earnings which will likely increase most people's retirement accounts and stock portfolios. Typical that I'm getting downvoted without any rebuttal.
That is the ideal but that isn't reality. The big corporations have large departments devoted to tax avoidance. Where does that saved money go? Usually distributed as dividends to shareholders, executive bonuses, or enormous bank accounts where the money does nothing (e.g. Apple).
The best way to improve the economy is put more money into the hands of normal people so that they will buy more stuff which in turn helps those businesses. Lowering or eliminating income taxes for non-rich people would help far more than a tax break for the rich which includes companies.