Should we abolish corporate taxes for businesses? | The Tylt

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Should we abolish corporate taxes for businesses?
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While people make a big fuss over corporate taxes, they actually pull in a smaller share of total tax revenue than most people think. The corporate tax system is broken because the global market incentivizes gaming the system and taking money off-shore. 

At the same time, in part because of the widespread gaming and the plethora of exemptions, corporate taxes don't contribute much to national budgets. According to the Organization for Economic Cooperation and Development, the average contribution in developed nations is just 2.8 percent of gross domestic product. In both the U.K. and the U.S. it's even lower, 2.45 percent and 2.6 percent, respectively. In 1968, corporate taxes accounted about a quarter of all federal tax revenues in the U.S. today, that share has shrunk to less than 10 percent.

Cracking down on these companies could incentivize them to move outside the U.S. entirely, so solutions must be careful not to exacerbate the situation. Abolishing the corporate tax entirely may not be a politically popular move, but it is one that makes sense and is backed by experts.

It may look unfair to tax consumers to compensate for a major business tax holiday -- but then such a move would give businesses a strong incentive to keep prices lower to avoid a drop in demand. Besides, liberated from corporate taxes, they'd have more freedom to increase wages. And the same time, there is a degree of fairness in imposing taxes where goods and services are consumed, and not where a company that sells them is domiciled.
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Critics are fundamentally opposed to abolishing the corporate tax on principle. Corporations should not be given free rein to to do what they want—they must work with the American people and be socially responsible. 

"The truth is that we have a rigged tax code that has essentially legalized tax-dodging for large corporations," Sanders said during a press conference.

Instead of abolishing corporate taxes, Sanders proposes closing the loopholes that allow companies to take advantage of the U.S. and shirk paying their taxes. Companies won't stop working in the U.S. because they suddenly have to pay taxes.

The bill also includes provisions designed to limit the tax benefits of corporate inversions — transactions in which U.S. companies merge with foreign companies and then reincorporate overseas. Additionally, the legislation would prevent U.S. companies from claiming to be foreign companies if their management and operations are based in the U.S.
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#CorporationsMustPay
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Post by Wayne D. Smith.
#EndCorporateTaxes
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Post by Prabha Singh.
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