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Corporate tax reform

Debate Information

From Fox News: "U.S. companies pay the highest corporate tax rate (35%) in the industrialized world. Understandably, they don’t like it and are coming up with creative ways to avoid paying their legally-required share. Notably, a growing number – at least 50 in the last two decades with the number rising sharply in recent years -- are undertaking so-called inversions in which they move their corporate headquarter overseas in order to avoid paying U.S. taxes. The U.S. is losing billions a year in revenue."
beaujoecavalryyolostide
  1. Live Poll

    Should corporations be heavily taxed?

    11 votes
    1. Yes
      45.45%
    2. No
      27.27%
    3. other (please comment)
      27.27%



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    Arguments


  • beaubeau 3 Pts   -  
    No, they should not be. The Trickle Down economic policy can work under the right conditions. 
    melanielust
  • love2debatelove2debate 186 Pts   -  
    Trump is trying to close many loopholes like that, and ensure that our tax rates are lowered to attract more business.  If he is successful with pushing tax reform through, it will be a win for US.
  • OakchairbcOakchairbc 88 Pts   -  
    A) Fox news is being misleading.Us corporate tax rates are almost the same as other developed nations[1]. 
    B) George Bush tried something similar to this, it failed spectacularly. The result was more companies stashing more cash overseas. The result was less US investment[2]. 
    C) Historically corporate tax cuts do not correlate with a better economy[3].
    D) It is almost exclusively the rich who benefit from corporate tax cuts. They would receive 82% of the benefits[4]. The GOP/Trump corporate tax cut is just a sneaky tricky way to give millionaires more money. 
    Furthermore the literature on topic finds that inequality reduces economic growth[5]. For example inequality increases debt/speculative bubbles. A 10% decrease in inequality results in a 50% longer growth spell[5] Here is some more reading[6].


    [1]https://www.cbpp.org/research/federal-tax/actual-us-corporate-tax-rates-are-in-line-with-comparable-countries
    [2]http://www.angrybearblog.com/2011/10/more-on-repatriation-win-america.html
    [3]http://www.angrybearblog.com/2011/09/corporate-taxes-and-investment.html
    [4]http://www.motherjones.com/kevin-drum/2017/10/trumps-treasury-department-deleted-research-that-contradicts-republicans-on-tax-reform/
    [5]http://motherjones.com/mojo/2011/10/study-income-inequality-kills-economic-growth
    [6]http://www.imf.org/external/pubs/ft/fandd/2011/09/Berg.htm

    joecavalry
  • joecavalryjoecavalry 430 Pts   -  
    @Oakchairbc , great argument and sources! I believe that corporations need to be taxed at a lower rate. Trump is trying to bring the corporate tax to about 20%. This would bring more companies into the country and allow them to invest more into the company and economy. This could greatly increase the GDP.
    DebateIslander and a DebateIsland.com lover. 
  • ViceRegentViceRegent 68 Pts   -  
    All federal income taxes should be abolished.  Defund the left and they will disappear, as they have no argument other than appeals to envy and coveting.  

    DrCereal
  • So here's the thing. The corporate tax rate is around 35% which would be the highest in the world. However, the effective corporate tax rate is closer to 25% which is fairly standard in the world. If the solution is to simplify the corporate tax rate, lowering the actual tax rate while eliminating deductions and loopholes, there is a case to be made that this should be done. However, simply lowering the rate without any other changes would simply lower the government income and would result in one of three things: Cuts to government programs: increase in alternate forms of government revenue (i.e. individual taxes, tariffs on imports, etc.) or increased borrowing and deficit spending. Reducing taxes can not be revenue neutral - and most economists, from both sides of the political isle, believe that lowering corporate taxes alone would not do enough to increase the economy sufficiently to offset the loss of revenue. 
    yolostide
  • ViceRegentViceRegent 68 Pts   -  
    Slash and burn most federal programs.
    DrCereal
  • yolostideyolostide 95 Pts   -  
    The tax reform plan should include corporate tax reform. If the corporate tax may not be dropped, the US economy and GDP may go down possibly. Corporate tax reform should also not be delay. It should go into effect immediately and so should the whole tax reform plan.
  • ViceRegentViceRegent 68 Pts   -  
    Here is a corporate tax reform: abolish all corporate income taxes.
  • FascismFascism 344 Pts   -  
    @ViceRegent
    The nation will quickly go into debt. How will it keep up the military for example?
  • ViceRegentViceRegent 68 Pts   -  
    @Fascism

    Abolish all government wealth redistribution plans and instantly save $3T dollars.  Imaginee, cutting taxes and balancing the debt?
  • FascismFascism 344 Pts   -   edited November 2017
    @ViceRegent
    The debt is caused by large corporations and rich people. See my arguments in an other debate:
    http://www.debateisland.com/discussion/1361/is-the-us-governments-presidential-voting-system-bad
    These corporations push the US government to use up money and go into debt, for their own benefit. For example, military contractors push the politicians to have the Iraq War, which causes the government to buy military equipment from the military contractors. Cutting taxes will worsen this, and give more power to the rich. 

    I agree that we will have to stop redistribution plans, but I don't agree that we should have tax cuts on corporations. Stopping redistribution plans is only one step in solving national debt. Trickle down economics has had no pattern on economic growth. Sometimes it made economy better, and sometimes it made it worse. 
  • ViceRegentViceRegent 68 Pts   -  
     No, the debt is caused by the government spending more money than it takes in in tax revenues. If we abolished welfare, they would stop deficit spending. 
  • FascismFascism 344 Pts   -   edited November 2017
    @ViceRegent
    I agree that the current welfare system should be abolished, but welfare isn't the only thing contributing to spending more money than it takes in. My argument addresses this. If we lower taxes in favor of corporations, they take advantage and the government ends up paying them. Plus there is also the fact that lowering the taxes lowers revenue. 
  • ViceRegentViceRegent 68 Pts   -  
    When i keep my money, the government is NOT giving me anything.   Get it your liberal big government presuppositions are the problem here.  And yes, if we abolish welfare, the The deficit disappears.
  • FascismFascism 344 Pts   -  
    @ViceRegent
    The government does not have to be liberal for my argument to stand. In my argument the government simply buys too many things from the rich. 

    "When i keep my money, the government is NOT giving me anything. "

    Yes, this is what people should do, but as my argument states, some rich people don't do this and purposefully pay for specific politicians to stay in power. Then these politicians in return take the national treasury and make it benefit these rich people. 
  • ViceRegentViceRegent 68 Pts   -  
    Really?  Tell me how many poor people bid on aircraft carrier contracts?  

    I promise that if the government stops its fascist regulation of business, no business will spend any money on government.
  • FascismFascism 344 Pts   -  
    @ViceRegent Read my argument in the link. This isn't about poor people. It's only about the government and the rich. 

    I promise that if the government stops its fascist regulation of business, no business will spend any money on government.

    http://www.debateisland.com/discussion/1361/is-the-us-governments-presidential-voting-system-bad
    I once again point to this link for the evidence I provided. 
  • ViceRegentViceRegent 68 Pts   -  
    Answer:  how does the government buy stuff from poor people?


  • FascismFascism 344 Pts   -  
    @ViceRegent ;
    It doesn't. My argument is only relevant to public opinion, the government, and the rich. 
  • ViceRegentViceRegent 68 Pts   -  
    Not reality?  That is typical of the left.  
  • FascismFascism 344 Pts   -  
    @ViceRegent
    What isn't reality?
  • ViceRegentViceRegent 68 Pts   -  
    You said you want the government buying stuff from poor people, but the reality is they have nothing to offer.  But you then said people are of the opinion they do.  I base my political philosophy on what is real, not what people wish was real.
  • FascismFascism 344 Pts   -  
    @ViceRegent
    No I never said I wanted the government to buy from the poor. I stated that the government buys too many things from the rich, but that doesn't imply that I want it to buy from the poor instead. I want the government to spend less and buy less things in general. 
  • ViceRegentViceRegent 68 Pts   -  
    Like what?
  • FascismFascism 344 Pts   -  
    @ViceRegent
    The Iraq War. 
  • ViceRegentViceRegent 68 Pts   -  
    What did the government box and from whom that you object to?
  • ViceRegentViceRegent 68 Pts   -  
    Buy
  • FascismFascism 344 Pts   -  
    @ViceRegent
    Congress is getting payed by military contractors to keep the Iraq War going. The reps in congress need that money to run for congress again, and as my link proves, the rep with the most money available for running is the most likely to win. With the Iraq going on, the military contractors, in return, get money from the US government, since the government pays them for the war. They make investments in congress representatives so that the government keeps giving them money. This is why the debt keeps piling up. Public opinion shows that most people don't even want this war, but the policy is still in favor of it. The reps are corrupted by these rich people. 

    It's much harder to corrupt the president since more people care about the presidential elections, but the president with the most campaign money is still more likely to win. If you are the president, there is a 50% chance that you got the most campaign money. Congress is in the 90s. 
  • ViceRegentViceRegent 68 Pts   -  
    Which contractor paid Congressman to keep the war going?  How do you keep a war going after your enemy has been defeated?  And now that the war is over?
  • FascismFascism 344 Pts   -  
    @ViceRegent
    The enemy is defeated but new enemies came in. We got reinvolved in 2014. This reinvolvement is still refered to as the Iraq War. And there are many military contractors which want the war going. Academi is one of the companies paying congressmen. 
  • ViceRegentViceRegent 68 Pts   -  
    Please share with me what companies wanted the war to keep going?  Tell us, how do you know Academi wanted the war to keep going?
  • FascismFascism 344 Pts   -  
    @ViceRegent
    With the war going they can make money since the government pays them. Academi pays congressmen to keep it going. Recently, it and other companies payed Steve Rothman, a congressman, to develop a fighter jet. The companies get the profit, the congressman gets the profit, the national treasury is drained. 
  • ViceRegentViceRegent 68 Pts   -  
    I got your claim, not I am asking for proof.  Please tell me how you know they wanted the war to keep going?  And have you contacted the FBI with your proof this Congressman was bribed?  And do you suggest we not have fighter planes?
  • FascismFascism 344 Pts   -  
    @ViceRegent
    Why would I need the FBI to have proof of this? The FBI does investigations whenever a politician does something illegal, and they are trying to cover it up. Academi giving funds to the congressman is public knowledge. It's legal and disguised under the term "campaign donation". Plus just because the US is developing a fighter jet doesn't mean the US doesn't have fighter jets. It could mean that it is making a better fighter jet. 

    There are many examples of this, not only military contractors. The NRA has influence when it comes to gun laws, fast food companies influence public school cafeteria food, and many others. There "campaign donations" are public knowledge. There is no need for FBI investigations. 
  • ViceRegentViceRegent 68 Pts   -  
    So, you have no proof of this bribery. Got it.

    Prove your claim about Acamemi, or I will infer you have none, and reject your claim as nonsensical leftism.


  • FascismFascism 344 Pts   -   edited November 2017
    https://www.politico.com/interactives/2017/gun-lobbying-spending-in-america-congress/
    http://www.thepeoplesvoice.org/TPV3/Voices.php/2009/10/08/graft-abroad-and-at-home-congressman-mur

    This is not only about Academi and the military, but also about many other campaign funders. 

    What does this even have to do with the left and the right? The Iraq War is not supported by the right and the left. The policies affected are not only bad for the left, but also for the right. 
  • ViceRegentViceRegent 68 Pts   -  
    I asked for proof, not websites.  I️ now infer your have no proof and dismiss your claim.
    DrCerealSilverishGoldNova
  • FascismFascism 344 Pts   -   edited November 2017
    @ViceRegent Citations include websites. Therefore, I can use certain websites as proof. 

    This information is openly available to the public. I used a nonpartisan governmental source which displays this info. 
  • ViceRegentViceRegent 68 Pts   -  
    Sorry, your claim has already been dismissed.
    DrCerealSilverishGoldNova
  • FascismFascism 344 Pts   -  
    @ViceRegent
    Because you have no refute? Ok...
  • ViceRegentViceRegent 68 Pts   -  
    Naturally, this blames his inability to attach reality to his claims is MY fault.  I shall waste no more time on him.
  • MayCaesarMayCaesar 4676 Pts   -  
    Whenever two actors want to perform an economical exchange, any tax on either party harms the return from this exchange for both parties, as the tax functions as a wedge in the transaction and shifts the negotiated terms in order to share the tax burden between the actors.

    Corporate tax diminishes returns from the economical operations businesses undertake. This leads to reduced amounts of those operations, and to increased prices for end consumers. The consequence is a reduction of overall economical activity, impediment of economical growth, loss of employment opportunities and wages... The end result is that nearly every economical operation (since the goods in those operations are almost exclusively produced by private businesses) becomes discouraged and less profitable for all parties involved.

    The mitigation of this effect is supposed to come from the effects of the tax collection revenue being spent on economically promising endeavors. However, the government is notoriously ineffective at getting high returns from its spending, in some sectors dropping to as low as 20% of the return achieved by private companies, and almost never (if ever) exceeding it.

    In other words, corporate taxation leads to pure wealth loss of the society and each and every one of its members, aside from those specifically favored by the governmental resource redistribution. The 35% corporate tax rate is monstrous, but even a 1% corporate tax rate can have significant negative long-term consequences.

    There is a reason for the overwhelming consensus on taxation among economists. That consensus states that individual income taxation is the most effective form of taxation possible, as it affects all individuals somewhat equally and does not have a direct effect on the economical activities in the society. Taxes affecting economical transactions not related to the individual income, however, such as sales tax, corporate tax, corporate gain tax, inheritance tax and so on, strangle the economy, reduce its output and overall make everyone's life more difficult.

    When some European model advocates such as Sanders point at the taxation rates in Europe and at the same time attack the "greedy corporations" in the US, what they do not realize is that most European states actually have relatively low taxation rates on economical activities. Those countries can get away with high individual income taxes, because the low corporate taxes and a strong deregulation of private market allows it to produce enough wealth to pay for the extensive public services. In fact, countries such as Sweden provide various incentives for small businesses, up to completely exempting many of them from having to pay corporate and/or sales tax. Such a model would not work in a country featuring federal corporate income tax of 35% (or much higher, as those people advocate for), various state corporate and sales taxes and countless regulations banning certain economical activities from ever happening. When Hollande tried such an experiment in France, it led to the biggest capital outflux in many decades and nearly collapsed the private market, before the government came back to its senses and sliced the taxation rates drastically.

    The US would do well to implement low taxation rates as in Switzerland, particularly with regards to non-individual income taxes. This country has all the potential to dominate the world in terms of GDP per capita; it just needs to have the anti-capitalist lobby quelled.

    P.S. I would not quote Fox News on economical matters. Think tanks such as Independent Institute, or even major pro-capitalist newspapers such as The Hill, Wall Street Journal, Forbes or Bloomberg, are serious sources, while Fox News simply panders to people of a certain leaning with no substantial arguments ever put forward.
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