Corparations and Taxes.. 66% don't pay

[hcap]

http://news.yahoo.com/s/ap/20080812/ap_on_bi_ge/corporations_income_tax

Most companies in US avoid federal income taxes

By JENNIFER C. KERR, Associated Press Writer 2 hours, 1 minute ago

WASHINGTON - Two-thirds of U.S. corporations paid no federal income taxes between 1998 and 2005, according to a new report from Congress.
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The study by the Government Accountability Office, expected to be released Tuesday, said about 68 percent of foreign companies doing business in the U.S. avoided corporate taxes over the same period.

Collectively, the companies reported trillions of dollars in sales, according to GAO's estimate.

.................................................. ......................

One of the legal principles of the Corporation is to exist as a "A legal person, also called juridical person or juristic person".

Seems the rest of us so-called legal folks are getting the bill. Another example of "Two Americas". And the abuse of capitalism by those that have the means to do so.

[prospector]

that's great...it should be 100%
corporations are owned by shareholders..they pay taxes, taxing the corporation and then again the shareholders is double taxation..it should stop.

[delayjf]

The report does not distinguished between those that showed a profit and those that did not

[boxcar]

http://news.yahoo.com/s/ap/20080812/ap_on_bi_ge/corporations_income_tax

Most companies in US avoid federal income taxes

By JENNIFER C. KERR, Associated Press Writer 2 hours, 1 minute ago

WASHINGTON - Two-thirds of U.S. corporations paid no federal income taxes between 1998 and 2005, according to a new report from Congress.
ADVERTISEMENT

The study by the Government Accountability Office, expected to be released Tuesday, said about 68 percent of foreign companies doing business in the U.S. avoided corporate taxes over the same period.

Collectively, the companies reported trillions of dollars in sales, according to GAO's estimate.

.................................................. ......................

One of the legal principles of the Corporation is to exist as a "A legal person, also called juridical person or juristic person".

Seems the rest of us so-called legal folks are getting the bill. Another example of "Two Americas". And the abuse of capitalism by those that have the means to do so.

Hey, 'Cap, allow me donate a clue to you: Corporations really don't pay taxes -- even when they do! This is because their tax costs are also computed into the selling prices of the goods and services that the consumers are buying. In reality, since consumers are always at the bottom of the tax chain, then consumers are the ones always paying all the taxes. This has nothing to do with the abuses of capitalism, but everything to do with the Marxist-friendly income tax system. With this system, things aren't what they seem because it's not nearly as transparent as the more direct sales tax system.

Boxcar

[Secretariat]

Hcap,

Great post. But trying to convince the trickle down nutcases is hopeless. On one hand they'll complain about tax rates, but then we find out 2/3rds of them pay nothing at all. What they don't get is the taxes we don't collect from corporations have to be made up elsewhere. Corporations are free to pass that on to the consumer, but a consumer also has the option of not purchasing their product. I'd prefer they be taxed as they used to be and give me a break on my tax bill instead of the free ride they get.

when one looks at the tax rates of the 50's and we realize that now 2/3rds of corps don't pay a red cent, is it any wonder we have a federal debt the size it is. i think the Republican Party should be renamed the Deficit Party, and the Conservatives should just be called cons.

[hcap]

Sec,

Not only are some here "trickle down nutcases", but apparently believe corporations should pay no taxes at all. If the legal definition of corporation allows those entities to have the rights of "persons", and at the same time insulate their officers from all manner of sins, I would think paying for those privileges should be mandatory. Btw,the most egregious scofflaws are the largest corporations.

http://www.huffingtonpost.com/robert-l-borosage/the-great-corporate-tax-h_b_118479.html

"But in 2005, with corporate profits reaching new heights as a percentage of national income, the GAO found that over one-fourth -- 28% of large corporations paid no taxes. (It defined large corporations as those with assets of at least $250 million dollars or gross receipts of at least $50 million dollars.) They can tell you how to make $50 million dollars and not pay taxes."

"Not surprisingly, the income collected from corporations has been declining as a percentage of GDP, with the burden transferred to your income and payroll taxes. According to a study by the Treasury Department, from 2000-2006, an average of 2.2% of GDP was collected in corporate taxes. This compares to an average of 3.4% in other industrial countries. The nonpartisan Congressional Budget Office projects that, under current law, corporate revenues will decline to 1.9% of GDP by 2017.

....................................

Many of these scofflaws are global and move their operations overseas in search of the cheapest labor pools. So it's a double whammy. We make up the loss of corporate revenues not collected by our taxes, and get to support their shifting of jobs overseas.

[Tom]

What about it hcap, how many did not show a profit?
And that was a good point earlier - corporations are owned by shareholders.
Tax the owners twice is not fair.

And btw, what the heck is a corparation?

[hcap]

http://www.gao.gov/new.items/d08957.pdf

Are you saying with corporate profits at record levels, CEOs getting record salaries....that 66% showed a loss from 98 to 2005?

From the Borosage link

http://www.huffingtonpost.com/robert-l-borosage/the-great-corporate-tax-h_b_118479.html

"GAO found that about two-thirds of corporations operating in the US did not pay taxes annually from 1998 to 2005.

[delayjf]

Are you saying with corporate profits at record levels, CEOs getting record salaries....that 66% showed a loss from 98 to 2005?

Are you saying that ALL corporations are showing record profits, and ALL CEO's are setting salery records??

[hcap]

Absolutely not. Are you saying 66% of corporations showed a loss annually from 1998 to 2005?

[Tom]

Read posts 3 and 7, hcap.....we are asking YOU since you are posing as the expert here. Or are you just another drive-by poster?
You peaked our interest....we want answers.

[jonnielu]

Hcap,

Great post. But trying to convince the trickle down nutcases is hopeless. On one hand they'll complain about tax rates, but then we find out 2/3rds of them pay nothing at all. What they don't get is the taxes we don't collect from corporations have to be made up elsewhere. Corporations are free to pass that on to the consumer, but a consumer also has the option of not purchasing their product. I'd prefer they be taxed as they used to be and give me a break on my tax bill instead of the free ride they get.

when one looks at the tax rates of the 50's and we realize that now 2/3rds of corps don't pay a red cent, is it any wonder we have a federal debt the size it is. i think the Republican Party should be renamed the Deficit Party, and the Conservatives should just be called cons.

Don't ever engage your brain, just hear and obey. What ever a corporation pays, you are paying it, along with whatever the corporation doesn't pay. The feds sucker you into electing for the same legal status as the corporation, at the behest of corporations and you think a politician is going to help you out. When you can't even pay then off or get them a whore. Very unrealistic.

jdl

[jonnielu]

Sec,

....................................

Many of these scofflaws are global and move their operations overseas in search of the cheapest labor pools. So it's a double whammy. We make up the loss of corporate revenues not collected by our taxes, and get to support their shifting of jobs overseas.

So why don't you direct your government to cut back some on those trillions that they are spending. It is government by the people.... right? Why don't you stop giving them your money... instead of electing the liars that put this into place in the first place?

jdl

[Valuist]

I was going to say a corporation would have to show a profit at some point if it was in business for at least 7 years (1998-2005).....but then I thought of Amazon.com. You can stay in business and not turn a profit if you have enough venture capitalists throwing money at you.

[Snag]

hcap, your post is talking about "68 percent of foreign companies" doing business in the US.

What are you trying to imply?

[Boris]

http://news.yahoo.com/s/ap/20080812/ap_on_bi_ge/corporations_income_tax



Did you read more than the first sentence at the link? Like this part:

An outside tax expert, Chris Edwards of the libertarian Cato Institute in Washington, said increasing numbers of limited liability corporations and so-called "S" corporations pay taxes under individual tax codes.

"Half of all business income in the United States now ends up going through the individual tax code," Edwards said.

The GAO study did not investigate why corporations weren't paying federal income taxes or corporate taxes and it did not identify any corporations by name. It said companies may escape paying such taxes due to operating losses or because of tax credits.


As others have stated, sales do not equal profits. They are completely independent. Also, the link paints "corporations" with a broad brush to bash "large corporations".

"It's time for the big corporations to pay their fair share," Dorgan said.

It may come as a surprise to the toolbags Levin and Dorgan that small business ruled the day from 1998 to 2005. I'm proud to say I ran one of those "corporations" that paid no income tax in a few of those years. Go me. How did Boris Houdini escape you ask? Simply, I did not want to be double taxed on MY hard work. On December 31st, I bonused myself just enough to take the corporation negative. Otherwise, the corporation (me) would be taxed at the corporate rate, and I would still be taxed for personal income when I decided it was time to cash out some funds. It just good business sense.

The link is a "straw man" to continue the class war important to these senators. Successful small businesses will never pay much in corporate taxes.

[Valuist]

Did you read more than the first sentence at the link? Like this part:




As others have stated, sales do not equal profits. They are completely independent. Also, the link paints "corporations" with a broad brush to bash "large corporations".



It may come as a surprise to the toolbags Levin and Dorgan that small business ruled the day from 1998 to 2005. I'm proud to say I ran one of those "corporations" that paid no income tax in a few of those years. Go me. How did Boris Houdini escape you ask? Simply, I did not want to be double taxed on MY hard work. On December 31st, I bonused myself just enough to take the corporation negative. Otherwise, the corporation (me) would be taxed at the corporate rate, and I would still be taxed for personal income when I decided it was time to cash out some funds. It just good business sense.

The link is a "straw man" to continue the class war important to these senators. Successful small businesses will never pay much in corporate taxes.

Were you a corporation or a sole proprietorship? The article appears to be talking strictly about corporations.

[Boris]

Were you a corporation or a sole proprietorship? The article appears to be talking strictly about corporations.

My business was incorporated. As many as 15 employees at one time, but was never happier when it was me and a part timer, my last 3 years.

$100 in profit = 15% corporate tax and then my personal tax rate when it came out on my paycheck, let's call it 28%. As a bonus, I could keep $720. As profit and then payroll, $612.00. What would you do?

[Secretariat]

What ever a corporation pays, you are paying it, along with whatever the corporation doesn't pay.

2/3rds of corporations pay zero taxes according to the GAO. Now, one can argue that corporate taxes are passed onto the consumer. True. But then I have the option of not purchasing a product from a corporation that does so. Our government must make up the revenue that it does not get from corporations directly from the individual wage earners. And to top it off despite the deceptively high US corporate tax rate. the effective taxes paid by American corporations are some of the lowest in the world. If other countries can make profits and still pay taxes why can't ours?

"U.S. corporate taxes as a percentage of gross domestic product are lower than in most other industrialized nations. From 2000 to 2005, revenue from federal and state corporate income tax averaged 2.2 percent of the U.S. GDP, compared to an average of 3.4 percent in 30 of its trading-partner countries, according to the Treasury Department.

Peter R. Merrill, a principal at PricewaterhouseCoopers, wrote an article in the publication Tax Analysts, underscoring this paradox.

Data on corporate tax as a percentage of GDP "present a conundrum," he wrote. "The United States has the second highest combined statutory corporate tax rate among (the Organization for Economic Cooperation and Development) countries, yet is tied with Hungary in raising the fourth lowest amount of combined corporate income tax revenue relative to GDP in 2004."

That was 2004, I would imagine it is even lower now. In other words, there are so many loopholes such as transfer pricing abuse, and offshoring that American corporations now pay one of the lowest effective corporate taxes relative to GDP in the world.

http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2008/08/12/MNC4129OFL.DTL

[jonnielu]

2/3rds of corporations pay zero taxes according to the GAO. Now, one can argue that corporate taxes are passed onto the consumer. True. But then I have the option of not purchasing a product from a corporation that does so. Our government must make up the revenue that it does not get from corporations directly from the individual wage earners. And to top it off despite the deceptively high US corporate tax rate. the effective taxes paid by American corporations are some of the lowest in the world. If other countries can make profits and still pay taxes why can't ours?

"U.S. corporate taxes as a percentage of gross domestic product are lower than in most other industrialized nations. From 2000 to 2005, revenue from federal and state corporate income tax averaged 2.2 percent of the U.S. GDP, compared to an average of 3.4 percent in 30 of its trading-partner countries, according to the Treasury Department.

Peter R. Merrill, a principal at PricewaterhouseCoopers, wrote an article in the publication Tax Analysts, underscoring this paradox.

Data on corporate tax as a percentage of GDP "present a conundrum," he wrote. "The United States has the second highest combined statutory corporate tax rate among (the Organization for Economic Cooperation and Development) countries, yet is tied with Hungary in raising the fourth lowest amount of combined corporate income tax revenue relative to GDP in 2004."

That was 2004, I would imagine it is even lower now. In other words, there are so many loopholes such as transfer pricing abuse, and offshoring that American corporations now pay one of the lowest effective corporate taxes relative to GDP in the world.

http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2008/08/12/MNC4129OFL.DTL

So what? What do we care about taxes somewhere else? What is the point of this piece of propaganda anyway, that corporations should be taxed more?

All of that is just the same BS that was used by business via the politicians that they own to get this system in the first place. How much revenue is the government supposed to get?

What does the amount of money that anyone earns, corporate or otherwise, (although every entity is corporate in the eyes of Washington D.C.) have to do with the LEGITIMATE COST of government?

jdl

[hcap]

The main problem according Dorgan and Levin
Companies abusing transfer prices — amounts charged on transactions between companies in a group, such as a parent and subsidiary. In some cases, multinational companies can manipulate transfer prices to shift income from higher to lower tax jurisdictions, cutting their tax liabilities. The GAO did not suggest which companies might be doing this.
...Companies use losses, improper intercompany pricing arrangements, and accrued tax credits to reduce or eliminate their tax bills, the GAO said in the study.

Yes corporations not making a profit pay no taxes. However the greater ability of large organizations to "game" the system thru' loopholes and creative accounting may explain so many NOT paying.

BTW,here is a comparison of the 2 candidates tax rate changes for individuals.

http://www.bartcop.com/candidates-tax-plans-08.jpg

[Tom]

So why don't you direct your government to cut back some on those trillions that they are spending. It is government by the people.... right? Why don't you stop giving them your money... instead of electing the liars that put this into place in the first place?

jdl

They tried that - the current dem congress! :lol::lol::lol:

[Valuist]

Ironically, there is one company who does pay billions in taxes and the government is trying to put windfall levels on them (Exxon Mobil).

[Tom]

If the left spend half as much energy working as they do trying to get some else to pay all thier bills, they would be republicans.

Is there no shame on the left? Their whole plans is to make other people pay thier way.

[boxcar]

2/3rds of corporations pay zero taxes according to the GAO. Now, one can argue that corporate taxes are passed onto the consumer. True. But then I have the option of not purchasing a product from a corporation that does so. Our government must make up the revenue that it does not get from corporations directly from the individual wage earners. And to top it off despite the deceptively high US corporate tax rate. the effective taxes paid by American corporations are some of the lowest in the world. If other countries can make profits and still pay taxes why can't ours?

You're living in La La Land if you believe you have the option of not purchasing from a company who factors in taxes into their selling prices. Virtually all corporations do this -- manufacturers and wholesalers alike. They simply look at taxes as a business expense and factor that cost into their selling prices -- so that ultimately the lowly consumer, who always lives at the end of the tax chain, winds up footing their tax bill. Of course, the way to eliminate this hidden burden from the consumer while simultaneously reducing the prices on goods and services significantly is to abolish the pernicious, unfair, immoral, hopelessly complicated, punitive and confiscatory income tax system and replace it with the infinitely more simplified and transparent sales tax system. The primary reason the U.S. can barely compete in the global marketplace anymore is because our prices are too heavily padded with tax expenses. I have little doubt at all that we'd be able to lower our prices by at least 20%, which would make us far more competitive.

Boxcar

[Valuist]

If the left spend half as much energy working as they do trying to get some else to pay all thier bills, they would be republicans.

Is there no shame on the left? Their whole plans is to make other people pay thier way.

I think this post would be best directed toward the corporations, not Hcap or Secretariat.

[boxcar]

I think this post would be best directed toward the corporations, not Hcap or Secretariat.

So...you're suggesting that the grand plan of politicians is to get corporations to pay for The People's way or for Politicians' way? :rolleyes:

For your info, Tom nailed it perfectly. Consider this as well: The liberal whiners and complainers and detractors of capitalism cry in their beer over the tax loopholes that smart corporate lawyers exploit? Well, sir, guess who put those loopholes there? Guess who designed them? Take a guess as to how many well-heeled lawmakers have interests in businesses in some way, shape or form.

Boxcar

[Tom]

The people who own corporations provide jobs, feed retirement and other investments, provide goods and services, fuel the economy, and continue to bring out new products that improbe our lives, security, liesure activites, health, nutrition, etc.

Let's stop calling them nameless instituitons - they are people. People who are getting screwed by getting taxed twice. Just so the dem can give it those who d no tpay taxes, do not contibute, and who drain our resources and stress our movers and shakers - I call them the yawners and sleepers.
Call it corpoate welfare if it somehow santizes your support of stealing. But unlike lib welfare, we get quire a bit of return on our money.