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follow jazz_music 2017 Sep 15, 2:03pm
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It is clear that a major goal of the House plan is to dramatically reduce the contribution that corporations and other businesses make to federal tax receipts. The plan represents an extraordinarily large tax cut for both corporations and other types of businesses, costing an estimated $1.3 trillion in the first 10 years after enactment. Much of the reduction would benefit the largest and most-profitable businesses, including those that have engaged in shifting profits and jobs out of the United States. This report considers whether a tax cut for corporations and other businesses is justified at this time.According to the chair of the House Ways and Means Committee, Rep. Kevin Brady (R-TX), this part of the House blueprint is designed “to grow jobs, the economy, and wages” [put hair on your head too, the same old lies] with “the lowest rates for businesses in modern history.”However, the House business tax plan’s ability to generate American jobs, stimulate economic growth, and increase wages is highly uncertain. Although proponents claim that there would be significant incentives for increased real investment in the United States, there is good reason to believe that this claim is not well-founded. Moreover, the DBCFT is unlikely to deliver an improved trade balance or eliminate corporate tax avoidance schemes, as its proponents claim. And it could have adverse effects on the real incomes of many American households.While enacting the destination-based cash flow tax is a high priority for House Republicans, this change to the corporate tax is unlikely to benefit anyone other than corporations and the wealthy. ...U.S. firms would still have incentive to shift income outside the United States [MAGA LOL]By design, the House GOP blueprint would impose no tax on active income from U.S. firms’ business activities abroad. In addition, profits earned abroad by subsidiaries of U.S. parent companies could be returned to the U.S. parent tax-free, with the apparent exception of income earned from passive investments abroad.However, there would still be many ways for firms to game this system in cases where the final customer is not in the United States. For example, as noted in a paper by Avi-Yonah and Clausing: A U.S. pharmaceutical with foreign subsidiaries could develop its intellectual property in the United States (claiming deductions for wages, overhead and R&D), and then sell (i.e., export) the foreign rights to its Irish subsidiary (at the highest price possible). The proceeds would not be taxable. Ireland would allow that subsidiary to amortize its purchase price. This creates tax benefits in each jurisdiction by reason of the different regimes. If the Irish subsidiary manufactures drugs, the profits could be distributed up to the U.S. parent tax-free under a territorial system.In addition, although the House blueprint would allow dividends from active operations of foreign-controlled subsidiaries to be repatriated tax-free, passive income earned overseas would be taxed under the retained Subpart F of the Internal Revenue Code. Together, these provisions might encourage firms with passive income to establish small real operations abroad in order to facilitate recharacterization of passive income as active. It would be difficult for U.S. tax authorities to distinguish passive income and income from active operations, especially where products or services contain elements of both. This is a problem under the current U.S. tax system and could be exacerbated by the House tax plan.
Private sector is the engine, and government keeps on cutting it down by taxing it more and more every year.
Private sector is the engine
What data says that?
anonymous saysPrivate sector is the engine, and government keeps on cutting it down by taxing it more and more every year.here I'm going to blow your mind and tell you every dollar the government takes out of the private sector via taxes it puts right back via spending.without government redistribution this economy would lock up, and quickly -- all those red states on Uncle Sugar's teat, dead.What makes the private sector really rip is increasing the discretionary income of people who would spend more if only they had more money; this happened in the mid-50s, late 70s, mid-80s and mid-00s in credit booms (aided by the rise in two-worker households): (% YOY growth in real consumer debt)and also the real wage rises of the 1990s, that was nice.
here I'm going to blow your mind and tell you every dollar the government takes out of the private sector via taxes it puts right back via spending.
increasing the discretionary income of people who would spend more if only they had more money
So lets have a 100% tax rate for the rich
Strategist saysSo lets have a 100% tax rate for the richNobody said tax the corporations at 100&. We are talking about the rate that would put the income distribution to a more normal rate. Corporations benefits hugely from 1T in spending on US military, they need to fund some of it.
. and you believe government growing is a solution?
Humans work on incentives. If you take away the incentives nothing much will be produced, and we become a failed nation, just like every single communist country. Even dogs and animals need treats and incentives to get them to do something. When corporations have the incentives to make more profit, they invest more, hire more people, produce more, our tax collection increases, our 401K's are worth more. In the end there is more for the 80 year old widow who cannot fend for herself. Everyone is better off. Lets cut taxes.
contemporaneous genocidal program to ANNIHILATE! the poor
Strategist saysHumans work on incentives. If you take away the incentives nothing much will be produced, and we become a failed nation, just like every single communist country. Even dogs and animals need treats and incentives to get them to do something. When corporations have the incentives to make more profit, they invest more, hire more people, produce more, our tax collection increases, our 401K's are worth more. In the end there is more for the 80 year old widow who cannot fend for herself. Everyone is better off. Lets cut taxes.Yes after all tax rates are so much higher now than say the 1950's. America would have been a failed nation if we didn't have such low tax rates back then. Do you ever even attempt to square reality with what you say?
We were competitive back then, but today we are losing that edge. We need to cut taxes just so our corporations can compete with other countries that have better tax rates
considering the advantages of being here.
You computer scientists seem to be the most critical resource of all employment nowadays.