Monday, April 1, 2024

Who Is Being Taxed


For John, BLUFWe need to understand our tax system, to ensure our legislators are playing fair with all of us, rich and poor.  Nothing to see here; just move along.




Here is the sub-headline:

ITEP's latest study exposes how the 2017 tax law has allowed major U.S. corporations to drastically reduce their tax bills, highlighting the need for urgent reform in corporate taxation.

From Nation of Change, by Reporter Ruth Milka, 1 March 2024.

Here is the lede plus one:

A recent study by the Institute on Taxation and Economic Policy (ITEP) has unveiled that numerous large, profitable U.S. companies have substantially reduced their federal tax bills, leveraging the provisions of the 2017 Trump-GOP tax law.  This legislation, which cut the corporate tax rate from 35% to 21%, has been under scrutiny for enabling lucrative loopholes that major corporations have exploited.

The 2017 Tax Law: A Catalyst for Corporate Tax Avoidance

The Tax Cuts and Jobs Act, hailed by its proponents for spurring economic growth, has faced criticism for diminishing corporate contributions to public investments.  “When President [Donald] Trump and congressional Republicans slashed the statutory corporate income tax rate… their goal was to allow corporations to contribute less to the public investments and the society that makes their profits possible,” the ITEP report elucidates.

The study focused on 342 profitable companies over the first five years since the law’s enactment, revealing that 23 of these companies paid no federal taxes during this period. Notably, Kinder Morgan, NRG Energy, and T-Mobile were among those with a 0% or negative effective tax rate. The analysis further disclosed that nearly a quarter of the examined companies, including giants like Netflix, Nike, and Citigroup, paid taxes at single-digit rates or less.

I know I should be upset by corporatoins not paying their fair share.  The thing is, when they pay their tax it is with my money.  The corporation doesn't create money out of nothing.  They create their wealth by selling things or services.  Who pays for those products or services?  You and I pay, and the corporate tacks on a little extra for profit.  Some of that is then raked off in Government Taxes.

It would seem to me that the appropriate place to tax is in terms of the dividends of those who have invested in individual corporations  For them it is income.

In the end, it is the consumer who is underwriting any taxes being paid by corporations.  It is coming out of your pocket.

That said, perhaps we cannot disentangle taxes from the concept that corporations are people, in term of free speech.

Regards  —  Cliff
  What is a fair share?  I hear the term, but I don't find definitions.  Do youhave a definition you could share

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