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Politics : PRESIDENT GEORGE W. BUSH -- Ignore unavailable to you. Want to Upgrade?

To: Bill who wrote (358556)	2/13/2003 11:27:39 AM
From: DuckTapeSunroof	Respond to of 769670

Good point. But the economic incentive for companies to reward their top people with equity positions, and options, remains with us. Cash salaries over $1 million are not deductible to the corporation, but equity-linked options are... which is one reason they prefer options grants. Another reason is because (and this was really pioneered by Microsoft) the options further stock watering schemes: options - when granted - are immediately taken as a tax deduction by the corporation... yet they are not reconciled on the annual reports as an expense (only showing up in a footnote). Therefore options are preferred because they allow inflated earnings to be reported (a higher "P" in the P/E ratio). The dilution effect down the road impacting upon the shareholders is also likewise largely concealed from their sight. Now... as to your question of "how anyone in the top 1% pays an effective INCOME tax rate anywhere near anyone in the bottom 50%." My post linked below may help: Message 18575199