The corporate tax rate is 15% to 39%. The highest rates are right up there with other industrialized nations but those taxed at the lower rates are very competitive with many nations. The US has to maintain a global air force, navy and army. We basically own the oceans--no other country does. The US has to maintain NASA. We basically own space exploration--like no other country. We have modern highways, airports, technical infrastructure, and international influence like no other country. All these things cost money. You are one of the ones always wanting to bomb the muslims from the face of the earth and establish global dominance, . . . but you just don't want to pay for it. Examples? labor costs are why companies are going overseas. Business gains a lot by locating in the US. The stability of our government, our currency, and our economy is unmatched by anyone, despite its recent problems. Lots of businesses exploiting low corporate taxes in the third world have seen their businesses get nationalized or even destroyed in violent conflict. They pay lower taxes to the government but very high bribes to corrupt officials. They see runaway inflation destroy their markets. They have issues with poor electical, water, roads, and communication systems. There must be some reason that you haven't moved your business to Hong Kong, Ireland or Romania for those low taxes. Obviously. This is why governments tax their citizens and businesses. It has always been that way. You want to get something for nothing.
this is not the case. maybe technically/legally, because they dont want to, but my field, science, would be dead in the water if it were not for the govt. the entire pharmaceutical industry would not exist, at least in any similar size/form.
Good luck getting other countries to change their tax laws to accommodate Obama. Dream on. As to further punishing American companies, good luck with that also. He has already had defections from the democrats, including the chairman of the finance committee. If Obama tried to do this while lowering corporate rates, he might get some success. Since he merely wants to squeeze harder, he will squeeze big business, which will in turn squeeze small business, and ultimately it's us that get squeezed. This one won't fly. As I pointed out in the Spector thread, gaining a majority in both houses is ultimately going to show that Obama is not bi-partisan, and his defeats will come from democrats abandoning him, not republicans. This is just round two. Get used to it buddy.
This is a really stupid plan thatwould have a devastating impact on the ability of US companies to compete in foreign markets. In the long run it will encourage companies to move more good paying jobs and critical business functions overseas. I especially have to question the timing. Common sense generally dictates that when economies are struggling you don't raise taxes. The silver lining is that this plan will not find much support in Congress and will probably never make it out of committee.
I really don't like the idea of increasing the tax burden on businesses, especially right now, but some companies are getting out of quite alot of tax payments with these things. I remember a story a few years ago about how Microsoft created a subsidiary in Ireland. They transferred over $16B in assets (patents, trademarks and the like) to this company and turned it into the offical distribution point for software licenses in Europe, Africa, and the Middle East. It only got noticed because it became the most profitable company in Ireland, making over $9B a year that is taxed at Ireland's low ~12%. Sounds perfectly legit till you realize this subsidiary is run out of a law office with about 12 people and over 80 large multi-nationals share the same address. I don't blame companies for doing this. They are just trying to save money and increase profits, which is, after all, the point of being in business. But Uncle Sam will always want his share. Maybe the solution is to both close the loopholes and lower the tax rates, a kind of carrot and stick approach. If Microsoft will only pay 12% tax on $9B in international profits I'd rather it be paid to the US rather than the Irish.
Republicans don't get it and never will. Obama was elected to change the things that got us into the sorry state of affairs that we're in. The pendulum always swings back when it goes too far in one direction.
