Funding infrastructure

[watu05]

Funding infrastructure investments by increasing the tax on corporations makes sense. First, someone has to pay for it and corporations will be primary beneficiaries. More importantly the effective US corporate rate is also relatively low, and the expansion of 'pass through' entities which pay no taxes at the 'corporate level' had further decreased federal income from corporations. These charts from the Peterson Foundation show how corporations federal income taxes has decreased as percentage of US federal revenues and as a percentage of GDP. A return to the norm seems justified.

Six Charts That Show How Low Corporate Tax Revenues Are in the United States Right Now

Compared to historical trends and other advanced economies, corporate tax revenues in the United States are low.

www.pgpf.org

 

[lawpoke87]

The effective corporate tax rate in the US is currently 27.7%. The average effective corporate tax rate among the 30 OECD countries is 27.1%. The proposed rate increases for capital gains and corporate would place us at the top of effective tax rates when compared to the 30 OECD....and by a significant margin.

It’s almost like Dems have never studied “cause and effect” as it relates to economics.

 

[aTUfan]

No need to raise the rates. Just eliminate bogus business deductions.

 

[shon46]

The effective corporate tax rate in the US is currently 27.7%. The average effective corporate tax rate among the 30 OECD countries is 27.1%. The proposed rate increases for capital gains and corporate would place us at the top of effective tax rates when compared to the 30 OECD....and by a significant margin.

It’s almost like Dems have never studied “cause and effect” as it relates to economics.

It’s almost like they are intentionally crashing the system

 

[astonmartin708]

The effective corporate tax rate in the US is currently 27.7%. The average effective corporate tax rate among the 30 OECD countries is 27.1%. The proposed rate increases for capital gains and corporate would place us at the top of effective tax rates when compared to the 30 OECD....and by a significant margin.

It’s almost like Dems have never studied “cause and effect” as it relates to economics.

The problem has been and will continue to be the expatriation of taxable revenue. We need to fund the irs so they can go after corporations moving money offshore and then tell the corporations that they will not be allowed to do business in the United States if they do not repatriate their taxes. Good luck to the apples and the Tesla’s of the world if they aren’t able to sell to US markets.

 

[lawpoke87]

The problem has been and will continue to be the expatriation of taxable revenue. We need to fund the irs so they can go after corporations moving money offshore and then tell the corporations that they will not be allowed to do business in the United States if they do not repatriate their taxes. Good luck to the apples and the Tesla’s of the world if they aren’t able to sell to US markets.

While I agree with your sentiment how much additional tax revenue are we looking at here?

 

[rivalcane]

the income tax is unfair because it is based solely on reported income. But there are ways to avoid reporting income; barter, under the table, unreported income, side benefits, tax schemes, tax exemptions, tax deductions.

 

[astonmartin708]

While I agree with your sentiment how much additional tax revenue are we looking at here?

~300 billion per year. Plus the fact that the lost taxable income likely isn’t being spent in the US either. (Which screws up the amount of investment our country is seeing)

 

[lawpoke87]

~300 billion per year. Plus the fact that the lost taxable income likely isn’t being spent in the US either. (Which screws up the amount of investment our country is seeing)

Would you mind providing a link? That amount seems absurdly high to me from what I know what out of country tax shelters.

 

[HuffyCane]

~300 billion per year. Plus the fact that the lost taxable income likely isn’t being spent in the US either. (Which screws up the amount of investment our country is seeing)

You really are more MAGA than you think. Illegal immigrants remit close to $30 billion from our economy every year. 20% of the Honduran GDP is remittances in small amounts via wire transfer from illegal workers in the United States being paid in cash. I assume you are against “screwing up the amount of investment our country is seeing” in this circumstance too. Right?

 

[watu05]

A number of studies have estimated the untaxed overseas profits to be from US$1.6 to $2.1 trillion. A 2011 study by JPMorgan Chase & Co. identified $1.375 trillion in undistributed foreign earnings.[3] A Wall Street Journal analysis in 2012 found that the amounts for 60 large firms grew by $166 billion in the preceding year, shielding 40% of their earnings.[2] In 2012, a Bloomberg study found $1 trillion held overseas for 70 U.S.-based multi-national companies, using public annual reports for years ending in 2010 and 2011, and it estimated an overall total of $1.6 trillion.[3] In 2013, a private research firm study asserted there were more than $2.1 trillion of U.S. corporate profits untaxed in 2013.[4] In 2016, the Institute on Taxation and Economic Policy, estimates $2.6 trillion held offshore and two-thirds of that is held by 30 U.S. companies, with Apple, Pfizer, and Microsoft being the top three (see chart).[5]

Foreign profits were up 93% from 2008 to 2013.[citation needed]

 

[shon46]

A number of studies have estimated the untaxed overseas profits to be from US$1.6 to $2.1 trillion. A 2011 study by JPMorgan Chase & Co. identified $1.375 trillion in undistributed foreign earnings.[3] A Wall Street Journal analysis in 2012 found that the amounts for 60 large firms grew by $166 billion in the preceding year, shielding 40% of their earnings.[2] In 2012, a Bloomberg study found $1 trillion held overseas for 70 U.S.-based multi-national companies, using public annual reports for years ending in 2010 and 2011, and it estimated an overall total of $1.6 trillion.[3] In 2013, a private research firm study asserted there were more than $2.1 trillion of U.S. corporate profits untaxed in 2013.[4] In 2016, the Institute on Taxation and Economic Policy, estimates $2.6 trillion held offshore and two-thirds of that is held by 30 U.S. companies, with Apple, Pfizer, and Microsoft being the top three (see chart).[5]

Foreign profits were up 93% from 2008 to 2013.[citation needed]

How about we stop sending trillions of dollars overseas and use that money to take care of our infrastructure instead of it being sent out to other countries who don’t give a damn about us! Problem solved without us touching the tax rate!

 

[astonmartin708]

You really are more MAGA than you think. Illegal immigrants remit close to $30 billion from our economy every year. 20% of the Honduran GDP is remittances in small amounts via wire transfer from illegal workers in the United States being paid in cash. I assume you are against “screwing up the amount of investment our country is seeing” in this circumstance too. Right?

I think every person that benefits from the federal government should pay federal taxes according to their ability to pay and their earnings. I don’t differentiate between illegals immigrants or long term legal non-citizens or any foreign national who earns money in the US and utilizes federally funded projects during their time in the states. If illegals weren’t constantly being chased for deportation, they might be easier to track and tax.

 

[astonmartin708]

Would you mind providing a link? That amount seems absurdly high to me from what I know what out of country tax shelters.

Excuse me, you’re correct it’s closer to 90 billion a year. 400 billion is for overall tax evasion / avoidance.

 

[watu05]

I think every person that benefits from the federal government should pay federal taxes according to their ability to pay and their earnings. I don’t differentiate between illegals immigrants or long term legal non-citizens or any foreign national who earns money in the US and utilizes federally funded projects during their time in the states. If illegals weren’t constantly being chased for deportation, they might be easier to track and tax.

As it is, illegals pay about $13B into medicare every year and are not eligible for benefits.

 

[shon46]

As it is, illegals pay about $13B into medicare every year and are not eligible for benefits.

Because they are illegal! 😂. No country in the world enables the BS we do!

 

[aTUfan]

As it is, illegals pay about $13B into medicare every year and are not eligible for benefits.

How? I rob a bank and invest it for 20 years. Then I give back what I stole. Should I be allowed to keep the interest it earned.

 

[lawpoke87]

As it is, illegals pay about $13B into medicare every year and are not eligible for benefits.

Suppose the counter argument is they’re receiving health care and education benefits far above what they pay in.

 

[aTUfan]

As it is, illegals pay about $13B into medicare every year and are not eligible for benefits.

If they are so good for our economy, why do the areas where they settle become run down and crime ridden?

 

[astonmartin708]

If they are so good for our economy, why do the areas where they settle become run down and crime ridden?

If you would like to compare the states with the most violent crimes per capita, and their % of illegal immigrants in their entire population. Very few of the most crime ridden states have the most illegal immigrants. Most of the worst states are in the American South. (Arkansas, South Carolina, Louisiana, Alabama, Missouri) are all in the top 10 of most violent crime, but they don't rank in the top 10 of immigrant populations.

 

[aTUfan]

As it is, illegals pay about $13B into medicare every year and are not eligible for benefits.

records show that they take more from overall services than they put in.

 

[HuffyCane]

I think every person that benefits from the federal government should pay federal taxes according to their ability to pay and their earnings. I don’t differentiate between illegals immigrants or long term legal non-citizens or any foreign national who earns money in the US and utilizes federally funded projects during their time in the states. If illegals weren’t constantly being chased for deportation, they might be easier to track and tax.

So you support stopping remittances you just can’t say it. Got it.

 

[astonmartin708]

So you support stopping remittances you just can’t say it. Got it.

I don’t mind them sending money anywhere they want as long as their income is taxed.

 

[lawpoke87]

I don’t mind them sending money anywhere they want as long as their income is taxed.

Unfortunately, since most are low income very little if any of that income is taxed providing they file a tax return.

 

[astonmartin708]

Unfortunately, since most are low income very little if any of that income is taxed providing they file a tax return.

Sometimes, though sometimes they’re not doing too poorly (depending on what they’re doing) I know some of the painters around Tulsa are making good wages.

 

[watu05]

The amount of taxes that the US loses out on from remittances that were not already taxed is tiny compared to the amount of untaxed corporate income that is run through offshore tax havens and kept overseas without being taxed. Even if those funds are not remitted to the US, they are still corporate assets that can be used for borrowing to facilitate higher dividends in the US. Decades ago, corporate income tax made up about 30% of federal revenues, now it is down to about 10%. Citizens United has only increased corporations' political clout to keep this trend going.

BTW US citizens who wish to renounce their US citizenship have to pay taxes on the wealth they accumulated while citizens. It is steep and a barrier. US Corporations wishing to move their domicile should face the same treatment.

 

[lawpoke87]

Pretty good analysis of this complex subject

Opinion | Anatomy of a Biden Tax Hike

The threat to American competitiveness is bigger than higher rates.

www.google.com

 

[watu05]

This money could be put to good use in rebuilding our infrastructure and supporting more R&D.

FACT Sheet: Offshore Tax Haven Abuse by the Numbers (November 2017) | The FACT Coalition

$129 billion to $205 billion: Amount that U.S. taxpayers lose in federal revenue to offshore tax haven abuse each year.

thefactcoalition.org

 

[astonmartin708]

Republicans refusing corporate tax increases just means that businesses will not be paying for the improved infrastructure that they use daily. If corporations don’t want to pay for infrastructure then they shouldn’t be allowed to use it on the taxpayer’s dime.

 

[HuffyCane]

Republicans refusing corporate tax increases just means that businesses will not be paying for the improved infrastructure that they use daily. If corporations don’t want to pay for infrastructure then they shouldn’t be allowed to use it on the taxpayer’s dime.

Half of Americans pay no federal income tax but do pay Soc Security and two thirds of those make less than $60K. Good to know you favor them not using the infrastructure either since they aren’t tax payers too. Stop falling for unworkable easy solutions that appeal to your political proclivities.

 

[lawpoke87]

It’s almost like some people don’t understand there are consequences to having corporate tax rates including capital gains among the highest of the OECD countries. I’m not against the idea raising taxes. I’m very against the current proposal due to its effect on economic growth here in the US. Growth which we need for jobs and future tax revenue.

 

[watu05]

Half of Americans pay no federal income tax but do pay Soc Security and two thirds of those make less than $60K. Good to know you favor them not using the infrastructure either since they aren’t tax payers too. Stop falling for unworkable easy solutions that appeal to your political proclivities.

During the 50's and 60's a third of federal income tax revenue came from corporations. Now it's about 10%. Personal income taxes and user fees and borrowing from China have filled in the gap.
Corporations are more efficient and benefit from better infrastructure and R&D which has been allowed to decay. Corporations have had it pretty good, but if corporations want to stay competitive and benefit from these improvements, they need to start paying their share again.
If corporations don't like it and want to move abroad, great. Let them pay a huge exit fee based on their assets just as US citizens have to. Citizens United!

 

[watu05]

Republicans refusing corporate tax increases just means that businesses will not be paying for the improved infrastructure that they use daily. If corporations don’t want to pay for infrastructure then they shouldn’t be allowed to use it on the taxpayer’s dime.

It not just improved infrastructure, it's competitive infrastructure. Our roads and bridges are dangerous, our trains are barely better than 100 years ago, and our airports and sea ports are relics compared to much of the world's. All that makes the US less competitive and more expensive to do business in. Places like Chicago and Indiana are so strapped that they sell highways and toll roads to foreign investment groups to obtain capital to cope.

 

[shon46]

@astonmartin708 @watu05, you guys sure have a fascination with other peoples money! It’s pretty simple to me. There are no more incentives for these countries to stay in the US. That’s why thousands of companies left for overseas destinations under Obama. Trumps incentives brought hundreds of businesses either back or kept them from leaving with his policies and through publicly shaming those who tried to leave. Without those tax incentives and pressure, their is no benefit of operating in the US. We don’t need companies to pay taxes to pay for infrastructure. What we need is to stop sending our hard earned money overseas!

 

[lawpoke87]

It not just improved infrastructure, it's competitive infrastructure. Our roads and bridges are dangerous, our trains are barely better than 100 years ago, and our airports and sea ports are relics compared to much of the world's. All that makes the US less competitive and more expensive to do business in. Places like Chicago and Indiana are so strapped that they sell highways and toll roads to foreign investment groups to obtain capital to cope.

Are you really arguing Chicago’s and moreover Illinois’ budget woes are due to corporate tax rates ?

Federal R&D spending is heavily tilted toward the military. Not sure why the left is so keen on more military spending and less private spending on technology innovation...and make no mistake, the type of tax increases being proposed by the Biden Admin will have exactly such an effect on private R&D and our ability to economically compete globally.

How Illinois became America's most messed-up state

The financial mess in Illinois is the inevitable result of Illinois continuously spending more on pensions and services than it can afford.

money.cnn.com

 

[watu05]

Are you really arguing Chicago’s and moreover Illinois’ budget woes are due to corporate tax rates ?

No.

Federal R&D spending is heavily tilted toward the military. Not sure why the left is so keen on more military spending and less private spending on technology innovation...and make no mistake, the type of tax increases being proposed by the Biden Admin will have exactly such an effect on private R&D and our ability to economically compete globally.

How Illinois became America's most messed-up state

The financial mess in Illinois is the inevitable result of Illinois continuously spending more on pensions and services than it can afford.

money.cnn.com

Yes, another problem with US R&D is that it is too oriented to defense. As posted previously "private" R&D depends more on short market opportunities while basic research creates the break throughs for the private sector to develop. Basically research depends on government funding. I'm sure corporations want to keep their R&D tax breaks.

 

[shon46]

No.

Yes, another problem with US R&D is that it is too oriented to defense. As posted previously "private" R&D depends more on short market opportunities while basic research creates the break throughs for the private sector to develop. Basically research depends on government funding. I'm sure corporations want to keep their R&D tax breaks.

Defense spending is a very small portion of our overall spending. We give far more money away to foreign countries. That needs to stop!

 

[aTUfan]

what happened to the trillions they collected from the tax on gasoline?

 

[watu05]

“There is widespread agreement that the United States is spending too little on its infrastructure.” — R. Richard Geddes, Ph.D., of Cornell University and the American Enterprise Institute, described how the United States has fallen behind. Available data suggests that infrastructure investment has fallen, relative to the size of our economy, and currently sits at inadequate levels. In his testimony, Dr. Geddes further noted: “The Congressional Budget Office estimated that combined federal, state and local spending on infrastructure was (in current 2019 dollars) $441 billion as of 2017. That was about 2.3 percent of U.S. GDP. It remains well below estimates of the spending needed to keep infrastructure in a state of good repair.” This CBO estimate of transportation and water infrastructure spending as a share of GDP represents the lowest level in more than 60 years (spending peaked at about three percent in the late 1950s).

Strong Infrastructure and a Healthy Economy Require Federal Investment

The United States has been underinvesting in infrastructure for decades, and American families and businesses will reap the economic consequences unless the federal government undertakes a major course correction.

budget.house.gov

 

[aTUfan]

I just planted another money tree in my back yard. I hope that will help