November 19, 2023 at 8:02 pm #184Jonathan BuhacoffKeymaster
Corporations need to pay a fair share of income tax without playing games with deductions and loopholes. A tiered tax on top-line (“gross”) revenue will accomplish this. Tiers can start small with a low rate to help small businesses survive, while getting increasingly larger with higher rates on the higher tiers.
The tiers and rates can be tuned to minimize the impact on corporations so that we can switch to the new system, and then later adjusted as needed. Corporations that are financially healthy will be able to absorb any additional tax as a reduction in their profits. Corporations that have grown very large at the expense of taxpayers through special deals and deductions and loopholes will find that they can’t afford to stay that big and will need to downsize. This will be a win for the people because that will create more opportunities for other companies to compete fairly and that will bring more choice and more tax revenue to the people.
Having a fair corporate income tax will reduce compliance expenses for corporations because the rules will be simple and unavoidable; it will reduce the audit expense for the IRS for the same reason, allowing the IRS to complete more audits with the same staff; and the increased overall revenue to the government along with the proposed sales tax will eliminate the need to have a personal income tax, which will then further reduce the compliance expense for millions of residents, reduce the processing expense for the IRS because it will only be looking at income tax and sales tax from businesses and not individuals, and ensure that even illegal residents pay tax and contribute to government funding because it will be built into purchases and they don’t have to send any separate payment to the government. The IRS can then focus on tracking down non-compliant businesses, which is a much smaller number than the number of people.
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