Corporate taxes as a share of profits are the lowest in decades, reports Damian Paletta: "U.S. companies are booking higher profits than ever. But the number crunchers in Washington are puzzling over a phenomenon that has just come into view: Corporate tax receipts as a share of profits are at their lowest level in at least 40 years. Total corporate federal taxes paid fell to 12.1% of profits earned from activities within the U.S. in fiscal 2011, which ended Sept. 30, according to the Congressional Budget Office. That's the lowest level since at least 1972. And well below the 25.6% companies paid on average from 1987 to 2008. Corporate income-tax receipts typically fall during recessions, and they declined sharply after the 2008 financial crisis, which wiped out big swaths of profits across the huge financial sector. But U.S. profits have rebounded sharply in recent quarters, while tax receipts have stayed low."And note, they are not paying 12% of their income, but 12% of their profits.
04 February 2012
U.S. corporate taxes at 40-year low
From the Washington Post's Wonkblog:
I just realized that I hate the supreme court ruling that says corporations have free speech rights, like individuals. But I also like the idea of corporate taxes. I think I need to revise my thoughts. If corporations are not entitled to an opinion, if only the people who work for corporations are entitled to an opinion, then I don't see why corporations should pay taxes. Things shouldn't pay taxes, right? Should we also tax vending machines or chairs or parking spaces? If corporations pay taxes, then shouldn't they also get a political voice? Can corporations cry "No taxation without representation?"
ReplyDelete-Chuck
Just to play with your idea, Chuck, how many votes should a corporation have?
DeleteLet's suppose there's a small town with 5,000 people, 1,000 of whom work for a local company making snowmobiles. A matter comes up that requires a town vote. How many votes should the corporation get? One? A thousand? Something else? (I don't have an answer...)
With all the corporate welfare, tax dodging, and tax breaks they receive, many corporations hardly pay any taxes anyway.
DeleteAlso, vending machines ARE taxed, through their sales and licenses.
What I find puzzling is that the bean counters are puzzled by this. It's exactly as their corporate masters have been setting things up to work for some time now. What's so puzzling about chickens coming home to roost? They always do, sooner or later.
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