Inconsistency of the Day

A thought occurred to me while I read this Wall Street Journal opinion piece that explains that taxes are high on American corporations. This is despite an earlier GOA report that showed a 12.6% effective tax rate.

It turns out there were two problems with that report. First, it had a small sample size. It was based on one year, 2010. That year saw heavy write-downs (i.e. tax deductions) from the financial crisis, so it was an anomaly. Second, it didn’t include taxes paid to foreign countries.

Another study, with a longer period or 2004 through 2010, showed the total tax rate exceeded 35%.

The thought that occurred to me was this: I wonder how those who tell us that ‘corporations are not people’ feel about corporate taxes. 

My guess is that they don’t want corporations to have a voice in the political arena, but they want to tax the heck out them, which I find inconsistent.

They should realize that corporations are made up of people. Shareholders and employees are people.

While I sort of agree that corporations in the political arena are usually out to use government’s power against us, I think the proper place to fix this is by reducing the power government has, rather than trying to keep the 16 year-old-girl away from the proverbial bad-boy.

I also think that the proper place to tax corporations is at the individual level. Taxing corporations just reduces the transparency of the taxes government is imposing on individuals.

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One thought on “Inconsistency of the Day

  1. The income tax should be abolished. Taxing – in other words, punishing – the production of things people want results in less of those things that people want.

    Taxes (in their various forms) were originally intended to provide government with revenue to carry out its ESSENTIAL functions as enumerated in the Constitution. What wasn’t specified in the Constitution as a legitimate and proper job of the government was left to the States and the People. Now we have a greatly expanded role of government – that of a nanny that not only takes care of us, but a nanny that assumes it knows what’s best for us.

    When government assumes the nanny role, people trade their personal responsibilities (and their rights) for what they perceive to be security. That is, the government assumes responsibility for them, but in doing so the government also demands more rights. Because it produces no wealth itself with which to feed and clothe its serfs, the nanny state government necessarily sees its role, and hence the role of its system of taxation, as a redistributed of wealth or income.

    If we assume a more limited role of government as originally envisioned and as proscribed in the Constitution, it is reasonable to propose that taxes should be generally based on how much of our “communal” resources someone uses, i.e. if someone owns half of the property and buildings in town, he likely uses half of the police budget. Hence, property taxes as a source of revenue serves as a reasonable proportioning tool to determine tax responsibility. In such a manner, individuals are paying in proportion to the government or communal services they are using. Everyone that receives benefit from the government should have an appropriate amount of skin in the game, i.e. people should not be in a situation where they get something for nothing. When people have skin in the game, they are less likely to permit politicians to waste their tax dollars. Instead of their income going – via taxes – to goods, services, programs, agendas, etc. that politicians think they should buy, their income – via either taxes or personal expenditures – goes to the things the people really want.

    Any corporate tax should not be based on income produced (that’s what we want them to produce more of), but on community resources used (that’s what we want them to consume less of). The efficient company produces more from less. That leads to an expansion of our economy, i.e. we are not just producing more, we are expanding the CAPACITY of our production.

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