Is giving large corporations a tax break really a bad thing?

[noStemsnoSTICKS]

I'm all for giving tax breaks as it relates to capitol improvement and new economic development. Examples could be tax breaks for local infrastructure improvements when adding a new division. Or a reduction in payroll tax when adding to the overall personnel head count.

But I'm not into providing tax incentives as a matter of procedure.

 

[Sharky1203]

They've never been that high. And, fun fact, they were at their highest during the 1950s (at the same time personal rates were at their highest)...but only for the richest corporations (and richest individuals).
A big part of our current problems economically go back to the Reagan era cutting corporate rates.


So, let's go back to the good old days of taxation...the Eisenhower years (Republican administration).

Corporate tax rates and economic growth since 1947

Cutting corporate taxes won't spur economic growth, and there is no evidence that high corporate taxes have a negative impact on the economy. In fact, there is no correlation at all between corporate tax rates and economic growth.

www.epi.org

True, it's always been a selling point for politicians to inflate statistics (so I said it in tongue in cheek). Just like the Republicans and Demcrats have flip flopped.

 

[Hawk_4shur]

I’m pretty sure we can all agree large corporations only care about money.
You take away their money by making them pay more in taxes and they will increase their prices.
Wouldn’t most people rather corporations not pay as much in taxes and not jack up their prices? I’d rather pay less money to buy something and I’m guessing most people aren’t going to be paying much more in taxes to offset large corporations not paying their fair share.
Why are we always having a big shit fit about them getting tax benefits.

That's not how prices work. They raise prices when they can without losing market share, not when their costs go up. If costs go up more than the price increase and their margin is eroded they discontinue that product.

Since a corporation is not a person, it's a reasonable argument that corporations shouldn't pay any income tax. The taxes should be paid by the employees and shareholders. The problem is a corporation could simply stockpile cash (which they do) tax-free, or use it to buy back stock or pay dividends (which they do), both of which get favorable tax treatment.

Why do corporations pay tax? Why is there an Estate tax? Why do any of us pay tax?

To fund the government. In 1990, the debt was $3 trillion. Now it's $33 trillion. That's $30 trillion dollars that were not paid in taxes in the last 33 years.

Somebody has to pay tax.

 

[IIowaFarmBoy]

Corporate Debt to Equity Value. No real issue currently. Interest rates be what they are. Starting a career in the 80s was hell.

Nonfinancial Corporate Business; Debt as a Percentage of the Market Value of Corporate Equities, Level

Graph and download economic data for Nonfinancial Corporate Business; Debt as a Percentage of the Market Value of Corporate Equities, Level (NCBCMDPMVCE) from Q4 1945 to Q1 2024 about credit market, market value, equity, nonfinancial, debt, corporate, business, percent, and USA.

fred.stlouisfed.org

 

[fsu1jreed]

Fvck yes...and get rid of the W and Trump tax cuts

 

[IAFB2021Champs]

Most corporations set prices at what the market is willing to bear (within limits). If you lower taxes, they will keep prices constant and take as profit.

Another way to look at it is to lower taxes on citizens, many of which will spend the additional disposable income, which also benefits corporations.

That’s possible. But I have a hard time believing if they have to pay more in taxes, that they will not try and push the envelope and raise the prices even more to the max limit they can before people start to go away.

I don’t know if you know this because I don’t know your income level. But for low income people living paycheck to paycheck. I doubt you can tax them much more than you already are nor will they have gobs of extra cash to spend if you lower their taxes as they don’t make much to begin with.
Either way, low income will continue to struggle regardless how much corporations pay in taxes but I was curious which way would benefit them more.

 

[ZachJump]

These companies make 10s of Billions and pay very little if anything. Charge them a fair rate but allowing them to pay so little is BS. They can raise prices and people can choose not to consume their services. Free market. They should pay a fair percentage.

Missing in all this talk about what a corporation makes and taxes is that any tax a corporation pays is before the individual owners are paid.

When the owners are paid…then they pay their own taxes.

Why is that step in the taxation process always ignored?

 

[CarolinaHawkeye]

And that’s why I said you didn’t need to share you input. You don’t care to actually listen or use any common sense. You just preach what you are told to preach. I forgot I’m supposed to also call you a homo for calling me a maga.

And you can gfy. You aren't very self aware, are you? Does sniffing trump's ass make you high?

 

[Randon]

Duh! It's called the national debt and raising enough revenue to balance the budget and with a surplus reduce the national debt. In just four years Trump raised the national debt by more than 8 trillion. His 2018 unfunded tax cut (2 trillion) mainly favoring the wealthy and large corporations was mainly responsible.

 

[Bulldogs1974]

That's not how prices work. They raise prices when they can without losing market share, not when their costs go up. If costs go up more than the price increase and their margin is eroded they discontinue that product.

Since a corporation is not a person, it's a reasonable argument that corporations shouldn't pay any income tax. The taxes should be paid by the employees and shareholders. The problem is a corporation could simply stockpile cash (which they do) tax-free, or use it to buy back stock or pay dividends (which they do), both of which get favorable tax treatment.

Why do corporations pay tax? Why is there an Estate tax? Why do any of us pay tax?

To fund the government. In 1990, the debt was $3 trillion. Now it's $33 trillion. That's $30 trillion dollars that were not paid in taxes in the last 33 years.

Somebody has to pay tax.

Apply this logic to citizens united

 

[jonesy5960]

I’m pretty sure we can all agree large corporations only care about money.
You take away their money by making them pay more in taxes and they will increase their prices.
Wouldn’t most people rather corporations not pay as much in taxes and not jack up their prices? I’d rather pay less money to buy something and I’m guessing most people aren’t going to be paying much more in taxes to offset large corporations not paying their fair share.
Why are we always having a big shit fit about them getting tax benefits.

You don't understand how the free market impacts pricing.

 

[WDSMHAWK]

Between this and the "End property tax at 65" thread the board Mensa members are really putting out a strong showing today.

 

[IAFB2021Champs]

Between this and the "End property tax at 65" thread the board Mensa members are really putting out a strong showing today.

Yeah it’s weird when some people try to think outside the box to help the millions of people struggling to get by everyday.
Instead you stand there with a thumb up your ass pretending the democrats and Biden are doing great. Has to be nice being a career politician and do absolutely nothing and be a millionaire. I’d say that’s a great showing but it’s not. It’s pathetic and frustrating.

 

[theVoicefromtheTomb]

Weird thing is that I along with millions would be saving money if prices of products wasn’t so high. Sounds like a better solution than millions of people being broke and not being able to pay bills.
Dems just love to think everything is rainbows and butterflies.

You do realize that tax breaks are inflationary.

 

[WDSMHAWK]

Yeah it’s weird when some people try to think outside the box to help the millions of people struggling to get by everyday.
Instead you stand there with a thumb up your ass pretending the democrats and Biden are doing great. Has to be nice being a career politician and do absolutely nothing and be a millionaire. I’d say that’s a great showing but it’s not. It’s pathetic and frustrating.

Thinking outside the box is great, but I would recommend taking an intro to economics course at your local learning center and then you would realize how laughable your suggestion was.

Also FYI I'm not really a fan of Biden or most Democrats tbh as they govern as "centrists" aka republican-lites and a lot of them are in the pocket of big corporations. Which is why we rarely get legislation that helps everyday Americans.

 

[wjr1818]

I agree that companies care about profit and will push off increased costs or taxes to the consumer. I see hundred's of financials a year, anywhere from $10m/yr up to a billion in revenue a year. Many of the good companies are in the 5-10% profit margin and have not changed much over the past 4 years. Their revenues have increased but alot of it is due to increased costs that go to the consumer.

I have a client that does $70m in revenue with 10 grocery stores. Their profit margins are up slightly before COVID (alot to do with people eating more at home), and they know they need to pass the increased costs of food, insurance, and labor off to the customer. They aren't going to eat it.

Many of these companies outline that if taxes were to increase they would pass this off to the consumer and not be able to re-invest as much into their business.

I'm open to lower corporate income taxes and higher sales taxes.

 

[sober_teacher]

That’s possible. But I have a hard time believing if they have to pay more in taxes, that they will not try and push the envelope and raise the prices even more to the max limit they can before people start to go away.

I don’t know if you know this because I don’t know your income level. But for low income people living paycheck to paycheck. I doubt you can tax them much more than you already are nor will they have gobs of extra cash to spend if you lower their taxes as they don’t make much to begin with.
Either way, low income will continue to struggle regardless how much corporations pay in taxes but I was curious which way would benefit them more.

When corporations got their tax rates cut under Trump, did they lower their prices>

 

[fsu1jreed]

When corporations got their tax rates cut under Trump, did they lower their prices>

Shhh, don't explain logic to him... doesn't have the mental intellect for it

 

[IAFB2021Champs]

When corporations got their tax rates cut under Trump, did they lower their prices>

They not sure if they lowered them but they sure went up once he was out of office. Not sure if you pay attention when you go to the grocery store but damn near every item is $5.00. Seems a bit odd considering I’m sure that every item is not costing the grocery store the same price.

 

[IAFB2021Champs]

Shhh, don't explain logic to him... doesn't have the mental intellect for it

Hahaha. Says the special needs stoner.

 

[jonesy5960]

That's not how prices work. They raise prices when they can without losing market share, not when their costs go up. If costs go up more than the price increase and their margin is eroded they discontinue that product.

Since a corporation is not a person, it's a reasonable argument that corporations shouldn't pay any income tax. The taxes should be paid by the employees and shareholders. The problem is a corporation could simply stockpile cash (which they do) tax-free, or use it to buy back stock or pay dividends (which they do), both of which get favorable tax treatment.

Why do corporations pay tax? Why is there an Estate tax? Why do any of us pay tax?

To fund the government. In 1990, the debt was $3 trillion. Now it's $33 trillion. That's $30 trillion dollars that were not paid in taxes in the last 33 years.

Somebody has to pay tax.

Exactly.

 

[sober_teacher]

They not sure if they lowered them but they sure went up once he was out of office. Not sure if you pay attention when you go to the grocery store but damn near every item is $5.00. Seems a bit odd considering I’m sure that every item is not costing the grocery store the same price.

Gee, I wonder if a pandemic, and everything that went with it, had something to do with it?

Did Biden pass a corporate tax hike when he took office?

And no - they did not lower prices when they got their tax cuts.

 

[fsu1jreed]

Hahaha. Says the special needs stoner.

It's handiabled weed connoisseur, but even stoned out of my mind I can still roll circles around you

 

[IAFB2021Champs]

It's handiabled weed connoisseur, but even stoned out of my mind I can roll circles around you

 

[CarolinaHawkeye]

They not sure if they lowered them but they sure went up once he was out of office. Not sure if you pay attention when you go to the grocery store but damn near every item is $5.00. Seems a bit odd considering I’m sure that every item is not costing the grocery store the same price.

They were heading upwards long before he got out of office. It's just that maga scum will not admit it. And his policies contributed to contributed to inflation as well. And maga scum will not admit that. But go ahead and bring democracy to an end and see what prices will do then.

 

[IAFB2021Champs]

They were heading upwards long before he got out of office. It's just that maga scum will not admit it. And his policies contributed to contributed to inflation as well. And maga scum will not admit that. But go ahead and bring democracy to an end and see what prices will do then.

What’s weird is you keep bringing up maga and think I’m trying to end democracy. I don’t give a crap who lowers my prices of groceries and other goods. That’s why I asked the original question that I did.
Clearly not doing anything isn’t working out to well for millions of people.

 

[fivecardstud14]

Hahaha. Says the special needs stoner.

What a nice christian little boy you are. Heaven is sure to be filled with people like you.

 

[IAFB2021Champs]

What a nice christian little boy you are. Heaven is sure to be filled with people like you.

Get a life bud.