Here's a counter to the tax cut trickle down theory.
Suppose we make corporate taxes 0%. What would corporations do? Simple, they would hoard profits, saving them for whatever need they might have in the future.
Suppose we make corporate taxes 100%. What would happen? Corporations would spend their profits down to zero so they don't just lose the money.
Want investment? Want trickle down? Make the corporate tax rate higher, not lower.
Source: was CEO of a profitable company for almost 2 decades. Learned that hoarding was expensive, you get double taxed, once at corporate and then again at personal IF you retain earnings. Even at 35% that hurt so we spent our profits down to zero each year, invested and handed out bonuses. There is the trickle down and it happens because of corporate taxes.
Isn’t the counter-argument that if corporate taxes are high, companies will just move to other countries where its lower? Then you lose all the taxes and all the jobs.
That's already happening, look at the HVAC company Trump claimed to fix. Jobs went to Mexico anyway.
It's not the taxes, it's wages. Taxes are just a percentage of your costs. Wages are a much, much bigger percentage. As a CEO/COO, I can manage the tax burden just fine, I just make sure I have enough expenses and presto! No taxes for me. That's relatively easy so all this noise about taxes is BS. The effective corporate tax rate in the US is under 19%:
That's noise in the system compared to wages. Jobs move out of the country because other countries have a lower standard of living and you can get the same work done for less money.
An issue that doesn't get addressed enough, IMO, is that when you do cut taxes, someone, somewhere, loses. If we cut the corporate tax rate to 15%, we will be incredibly competitive with other countries, but that doesn't mean corporations will bring that money back here. They have a fiduciary duty to increase profits, and reduce costs. Tax evasion is a crime, but tax avoidance is not.
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[ 1.7 ms ] story [ 19.3 ms ] threadSuppose we make corporate taxes 0%. What would corporations do? Simple, they would hoard profits, saving them for whatever need they might have in the future.
Suppose we make corporate taxes 100%. What would happen? Corporations would spend their profits down to zero so they don't just lose the money.
Want investment? Want trickle down? Make the corporate tax rate higher, not lower.
Source: was CEO of a profitable company for almost 2 decades. Learned that hoarding was expensive, you get double taxed, once at corporate and then again at personal IF you retain earnings. Even at 35% that hurt so we spent our profits down to zero each year, invested and handed out bonuses. There is the trickle down and it happens because of corporate taxes.
It's not the taxes, it's wages. Taxes are just a percentage of your costs. Wages are a much, much bigger percentage. As a CEO/COO, I can manage the tax burden just fine, I just make sure I have enough expenses and presto! No taxes for me. That's relatively easy so all this noise about taxes is BS. The effective corporate tax rate in the US is under 19%:
https://cbo.gov/system/files/115th-congress-2017-2018/report...
That's noise in the system compared to wages. Jobs move out of the country because other countries have a lower standard of living and you can get the same work done for less money.