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Tuesday, February 19, 2013

The Income Tax

A week or two ago, I found an article explaining shell companies and how state and country laws can manage to keep them away or become shell company havens. Now, get this:
Meanwhile, many ultra-wealthy Americans and many of the most profitable corporations in the country pay little to nothing in taxes.  In fact, as you will see below, there are dozens of very prominent corporations that make billions of dollars in profits and yet don't pay a dime in taxes.  Tax avoidance has become a multi-billion dollar industry in the United States.  Those that have the resources to "play the game" use shell companies, offshore tax havens and the thousands of loopholes in our tax code to minimize their tax burdens as much as possible.  Meanwhile, the rest of us get absolutely hammered.  This is fundamentally unfair.  The federal income tax system is irreversibly broken at this point, and it is time to abolish it.  If you think that the federal income tax system can be "fixed", then you probably have never studied it.  
It's true that politics is all a game in politcian's minds, including those who run companies and are big donors - I lump with in with the politicians with whom they play the game.  Maybe that's why so many of them seem to feel it's no big deal to cheat and lie - it's only a game in their minds. You can tell a lot about someone's personal morals by how they play games. This is a sideline, however.

As far as taxes goes, why do businesses get taxed directly at all? The employees are already taxed. Why does the government want to tax the profits a certain company makes (for those without lobbyists, at least) at all, when that money is reinvested in growing the company and hiring more employees - more taxpayers? That doesn't make sense. If a company is investing in stocks, I have no problem with taxing that interest, but if the company is taxed just on profits, it cuts the rate of growth that could be achieved. I don't believe for a second that taxing businesses is fair when their employees have already been taxed - supposing that their employees make more than the line at which refunds occur (varies depending on credits). However, I do not support American companies "growing" their holdings internationally while not paying US taxes on that interest.

We absolutely  need a fairer system such as the 10% across the board rate that Dr. Ben Carson proposes - not that the politicians in Congress will ever give us one, because they're mostly part of that elite who get around paying taxes themselves and they're the ones writing the laws to soak the middle class and spare the rich. I'm not naive enough to think that abolishing the income tax will solve America's problems either.  We've spent far too much borrowed money for that.

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