Friday, August 15, 2008

Corporate Tax Rates - A Primer for The Government Educated!

Another fine offering by Little Duke:

Today’s Wall Street Journal has it.

It’s just another example of politicians depending on the dumb masses. (As Neal Boortz say it, go ahead, say it three times fast) They scream about going after those evil corporations that don’t pay their fair share, while corporation after corporation leaves this country for greener pastures. Anhauser Busch is just the latest and it won’t be the last. While our rates are almost the highest in the world, our revenue from the tax is very low and getting worse. Politicians continue to use the tax code as a favor granting / social engineering scheme instead of a revenue generating vehicle and this leads to every company trying to jump through hoops to comply.

Of course, the dirty little secret that out esteemed elected officials are either to stupid to understand or are lying to us about is that businesses don’t pay taxes, individuals pay them. Don’t believe me? Let me explain what politicians don’t want anyone else to understand. A company makes $100,000 in profit in a year. At 25% tax rate, they owe $25,000 in taxes. Who pays it? You only have three choices…

1. Owners. It comes off the profit, so the stock holders take a $25,000 hit. There goes your parent’s retirement fund. Your parents just paid the tax.

2. Customers. Let’s say the company just built it into the price. That means the customers paid it. Another set of individuals just paid the tax.

3. Employees. What could the company have done with that money? Maybe offer better pay packages to its employees? Not any more, your friendly politician has the money now and just paid for a cow flatulence study that happens to be taking place in their home district. (Any real flatulence study should be done every time a politician opens their mouth.)

There you have it; the tax is paid by one of those groups of individuals, not the company. Instead of allowing the politicians to hide the true cost of government, it is time for the Fair Tax. NO CORPORATE TAXES. Just imagine for a second how fast companies from around the world would be scrambling to relocate here. Our individual tax base would go through the roof.

See the details here.

Little Duke