Sam-- Obviously I agree with the Krugman article, but I would like you, and others, to consider an alternative proposal-- elimination of all corporate taxes. Its counterintuitive, but follow. Corporate taxes are disguised soak-the-poor taxes.
Corporations, not being people, don't pay taxes --they collect them from people and transfer money to the Govt and shareholders (and many privileged executives). They collect money from customers. Corporations, then, are politically expedient dodges to collect money from PEOPLE. Their profits are taxed at a fixed rate --I believe it is now 48%. The dividends are distributed to a wide range of incomes, but mainly the upper 10% of the population. Given this, all shareholders, rich and not so rich, are taxed at a fixed corporate rate. That means that the schlep with ten shares is taxed at the same rate as the holder of 100,000 shares. I would like to see the dividends taxed at a progressive rate. Therefore, instead of the fixed corporate rate, it would be a progressive tax.
Secondly, the source of money for corporate taxes will be the customer. However far down the food chain of purchasing, the customer will inevitably be the consumer. Once again, that means, given a fixed corporate tax rate, all customers are taxed at the same rate. I want taxes to be more progressive.
This would also free money for the corporations to hire and engage in more capex, and therefore helping the economy.
I wish the dems had the balls to point this out.
fred |
