SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Politics : Moderate Forum
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: Sun Tzu who wrote (14354)12/4/2004 1:24:41 AM
From: cosmicforce  Read Replies (2) of 20773
 
< I don't believe corporations should be taxed at all.>

This is interesting because I started to agree, but only until I thought deeply on the matter. I've always felt luxury consumption should be taxed because it is not regressive and promotes social stability in the society. Those who can pay, should pay. I don't think the poor (the definition of poor TBD!) should be taxed at all.

What if you had $1.5 B in equity that came from $1 MM invested? The $1.4B in equity growth are not actually realized until the shareholders convert it to houses, cars, jewelry or shares in other equities.

If the company doesn't offer a dividend (personal income equivalent, returned to the owner), then there would be a great motivation for people to simply not cash in their shares, but rather leverage against them as part of a fully collateralized line of credit. You don't pay income tax on debt, even if it is collateralized by stocks that have gone up 1000x.

Taxing corporations prevents them and their owners from growing in an unlimited manner like an untrimmed hedge (this actually promotes competition and rewards start-ups which haven't produced income yet). If you didn't tax corporations, you'd end up with 3 or 4 large players owned by a handful of insiders. The insiders could live like kings (by raising untaxable debt against their collateral). This amounts to an unlimited tax deferment which would be regressive.
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2025 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News