Corporate Income Tax
The current tax system imposed on corporations by the U.S.
government is at best, a biased system; for corporations that
have a net profit, taxes on those profits amount to a full
one-third. So, if you're doing business as a standard "C"
corporation, and you do manage to make a profit, you're going to
owe Uncle Sam about 30%. That's an amazing figure, so let's look
at some of the behind-the-scenes information that will help to
enlighten us as to the "why" so much tax should be levied.
The first thing you must understand when dealing with the
corporate tax structure, is that for the most part, many large
corporations do not pay the complete 30% tax that would
typically be levied against an individual if they were in the
same situation; corporate accountants and the sheer process by
which corporations must report their income, expenses,
deductions, depreciation, dividends, and any other financial
transactions allows for huge deductions that typically offset
any tax due. This concept is a major topic of discussion today,
as we attempt to better control and regulate corporate
accountability for their finances.
When you have large corporations that are obviously reporting
earnings and paying dividends, yet they pay no tax, you should
be tipped off to the fact that there is a problem. How to fix
that problem, may be another subject altogether.
The latest proposals have been to eliminate the corporate tax
altogether. This would shift the tax burden to the individuals
of this country; that is a tremendous shift from the post-war
era of the Second World War, when corporations and individuals
shared the responsibility almost equally. Thanks to the lobbying
done by corporate lobbyists over the last thirty years, we've
finally reached the point of no return. The latest proposals
have come from within the halls of Congress to eliminate
corporate tax, and let the average taxpayer assume all the
responsibility.
In case some of you have noticed, we as individual citizens are
losing more and more of our take home pay each year, to taxes of
some kind. Medicare, social security, and income taxes take a
larger portion of our dispensable income each year. This would
take a step closer to making even more of our income the
property of the tax man. What about this seems unfair? As
pointed out by the individuals who are in favor of eliminating
corporate tax, it would encourage capital investment and job
growth in this country and that is absolutely true, it
theoretically would do just that. But since when does theory
actually work in practice? Communism works in theory. Many
individuals believe it is simply another way to provide tax-free
income to CEOs, and Board Members. The latest scandals such as
Enron and HealthSouth have shown this country real hard evidence
of the corporate abuses that are rampant in this country, and so
far uncontrolled. The Sarbanes-Oxley Act has taken great steps
toward greater accountability on the part of the corporate
environment, but elimination of corporate tax is simply a legal
way to avoid paying the tax. The most interesting information I
have found in researching this topic, is the fact that the media
has paid little or no attention to these issues, thus allowing
the purported growth of the corporate lobbyists to go virtually
unnoticed by the American public. While mush emphasis has been
placed on the Social Security issues we face, nothing has been
mentioned about the loss of revenue we've experienced over the
last thirty to forty years because of the decreased taxation of
corporate America.
Where have tax laws and law makers turned to accommodate the
decrease in corporate tax? There have been increases in
individual tax liability and there has been an increase in sales
tax. The sales tax affects the poorer of this country as a
percentage of income, than the rich. The loss of revenue from
the corporate structure of this country have led to starved
educational systems, cities and counties that are revenue poor,
and a economic system for the poor that only becomes harder to
sustain.
When you factor in the ability of the wealthy and the corporate
entities of this country to hire brilliant accountants that find
loopholes in the tax system, and relieve their clients entirely
of their tax liability, you cannot believe that the current
system operates for the people, by the people, can you?