Replace Corporate Income Tax with Excise Tax
A 2% (may be modified to economic conditions) excise tax on total business receipts will produce higher revenue to the government than the current Corporate Income Tax. It will also reduce business accounting and tax code compliance costs by $100s of billions.
Corporate Tax Revenues:
2000 - $207 billion
2001 - $151 billion
2002 - $148 billion
2003 - $132 billion
2004 - $189 billion
2005 - $278 billion
Source: Tax Foundation taxfoundation.org
Total Business Receipts in 2002 (most current data available) - $23.4 trillion
irs.gov Using 2002 as an example, a flat 2% tax on total US Business receipts would produce IRS income of $468 billion, an amount higher than Corporate tax receipts in any year in history.
Replacement of the Corporate Income Tax with an excise tax on total business receipts will eliminate the business expense deduction of individual FIT and FICA taxes withheld from wages. Total, undiluted taxes withheld from employee paychecks may be deposited/credited to the IRS and the Social Security and Medicare Trust Funds. The result would be surpluses in OASDI FICA taxes that could be deposited in a NEWLY CREATED TRUST fund with compounding asset earnings instead of compounding debt in the current construct.
These changes may not completely solve the problem of Social Security insolvency, but it damn sure beats the dismal prospects reflected in current law.
Government continues to head in the WRONG direction. Example:
Tax cuts enacted since President Bush took office are typically described as benefiting individuals and not businesses. Businesses are often depicted as sitting on the sidelines, waiting patiently for their turn to have their taxes reduced. The last two tax-cut measures, however, included substantial tax cuts for businesses, including very generous write-offs for investments in plants and purchases of equipment. Under the package enacted in May 2003, businesses can immediately write off 50 percent of the cost of these new investments; businesses with smaller levels of new investments and purchases can immediately write off the full cost of new investments and purchases up to $100,000.
2% Excise Tax on ALL imports
To level the playing field between domestic and foreign production, my proposed excise tax on business receipt would ALSO apply to ALL imports including Canada and Mexico. The latter could respond with a similar tax, thus trashing NAFTA, that I think would be a good idea.
Any foreign country that imposes higher tariffs on American imports than the 2% would have tariffs on their exports to the USA MATCHED, whether they like it or not.
If this country is to survive, a sound currency linked to a store of value, and tax and welfare policies must be developed that stimulate prosperity instead of DEBT.
Politicians must be held accountable for the sorry mess we find ourselves in, but US citizens and businesses must first account for their own actions OR the welfare system will overwhelm our resources to compete. It may be too late, but I don't think so. The journey of a 1000 miles begins with the first step.
Citizens must wake up and force their WILL on legislators or face the prospects of a dismal future. Compounding Growth OR Compounding Debt, which do you choose?
I've posted more than enough in the past few weeks..... Back to research and analysis, which is the part I enjoy. And, to answer the question of a previous post, - I do not play golf. From the criticisms I receive, I suspect many would prefer I take up the game. I'm growing old and tired, perhaps I should consider it.
God Bless America!
SargeK
Getting Ready for Hard Times" debtism.com |
