Ira,
I agree with you on various reasons behind creation of corporations. And what I should have made clear is that I'd get rid of all business taxes, corporate or the mom and pop shop. As you have pointed out, there is no sense in placing small shops at a disadvantage to big corporations. Look at it this way, big or small, the reason behind any business to provide for its owners, so what is wrong with keeping the owners more directly responsible for the benefits they receive.
Our discussion was not really about the taxes though. We were discussing the effect of corporations in politics and society as a whole, as brought up by James Calladine. I was pointing out that I think it a big mistake to give the corporations the same rights as people. Somehow the discussion got side tracked. Look at it this way:
· A corporation has no natural life, but you do.
· A corporation is not naturally motivated to make the world a better place for its offsprings (spin offs), but you are.
· A corporation wants to expand as much as it can and take over as much as possible. Most of us are less and less likely to want as more and more of our needs/wants are satisfied.
· A corporation has often more resources than most people do.
So the question is this. Do you really want such an “immortal”, greedy, powerful thing to have the same rights as you and have a say in your future? You are not equal. Why should you have equal rights?
Jerome,
As pointed out above, the discussion was not originally about taxes. It was about equal treatment of corporations and people. It so happens that you cannot say "I am going to tax corporations like a real person and take them to the courts like a real person but I am not going to give them the same rights as a real person". There are gifts for which the price is too high. I am willing to bet, that if we stopped treating corporations like real people and instead held their human parts accountable, the world would be a better place. For example if instead of fining corporations for their wrong doing, we were to take the money directly from it directors and executives (and potentially give them a few nights in jail) we'd have much better corporate citizens.
Now to answer your question re the effect of taxes on prices, I am sure you know that the price of any commodity is set by supply and demand. One of the factors that effects the supply at a given price point is the production costs. So while no business has an incentive to pass on the cost savings (in this case taxes) to the public, if they maintain those high margins for a long time, they will cause others to join that line of business and will have tougher long term operating conditions. The future traders' saying of "there is no cure for high prices like high prices" holds true for everything.
I agree with you on the need for an equitable way to tax the corporations. There are two ways to make it equitable. One way is to say “A and B will be given equal rights and there fore shall contribute equally”. This method has so far failed IMO, largely because humans and corporations are not created equally. The other way is to say they shall not contribute equally and will have [justly] disproportionate rights.
Let me also say that I have found you an intelligent person and have respect for your opinions. I think for you to call someone naive because they propose a radical idea, is out of character. You should consider the possibility that perhaps that person has thought about the idea longer than you. And that may be, there are other angles to it that you just haven't heard about.
Regards,
Sun Tzu
PS Yes I did say that some of the related laws in banking, taxation (and perhaps criminal) laws will need some adjustment.
PPS Off shore holding companies provide near perfect tax relief. |
