A deeper recession on the Horizon?

[KeeperoftheBar]

Yes the major of loopholes are for corporations and the rich which is why they pay so little in taxes the problem is not the tax rate but the loopholes.  evertime they rise the tax rate they add new loopholes so that the corporations and the rich end up paying less taxes.  Like GE not paying any taxes.  What needs is the lower the rate down to 20% or so and close all the loopholes then the government would get twice the taxes off the rich and corportations. 

I can not agree with the desire to raise corporate rates.  Corporations do not pay taxes, consumers pay taxes.  Any "taxes" businesses pay are included in the price of what they sell.  However, it is easy to claim to raise corporate taxes because corporations don't vote and by doing so citizens never figure out just how much our bloated goverment is actually costing them.

[arbcoind]

Just my cheap 2 cents.  Corporations do indeed pay taxes.  The corporation I own pays estimated quarterly tax to the PA Department of Revenue (form PA-40ES) and to United States Treasury (form 1040-ES).  The estimates are based on our current sales/receivables and the safe harbor from the prior year.  The checks come out of our operating account.  How is that not paying tax? 

Gina

[DonaCatalina]

When it gets refunded back at the end of the tax season ala General Electric and many others.
But apparently you have to be big enough to buy your own special tax loophole from your congressman.

[arbcoind]

No loopholes here.   We get a refund or credit if we overpay our taxes.  Just like a personal tax return.

Although I must admit, my business has gotten very busy these past 5 months.  Hence the reason to remit estimated tax...don't want to get caught owing a penalty come next tax return.

Gina

[Zaubon]

Just my cheap 2 cents.  Corporations do indeed pay taxes.  The corporation I own pays estimated quarterly tax to the PA Department of Revenue (form PA-40ES) and to United States Treasury (form 1040-ES).  The estimates are based on our current sales/receivables and the safe harbor from the prior year.  The checks come out of our operating account.  How is that not paying tax? 

Gina

Do you pay those taxes completely out of corporate profits, or are they another expense that is included in the total price of your goods and services? The argument is not that business do not write checks to taxing authorities, but that ultimately the consumer is paying those taxes through increased prices.

Zaubon

[KeeperoftheBar]

Just my cheap 2 cents.  Corporations do indeed pay taxes.  The corporation I own pays estimated quarterly tax to the PA Department of Revenue (form PA-40ES) and to United States Treasury (form 1040-ES).  The estimates are based on our current sales/receivables and the safe harbor from the prior year.  The checks come out of our operating account.  How is that not paying tax? 

Gina

Do you pay those taxes completely out of corporate profits, or are they another expense that is included in the total price of your goods and services? The argument is not that business do not write checks to taxing authorities, but that ultimately the consumer is paying those taxes through increased prices.

Zaubon

Thank you Zaubon, you explained it much better than I could.  Theroretically, without corp income taxes, the price of goods would be lower to the consumer but the goverment's revenue loss would be made up by higher taxes to the individual.

[arbcoind]

These taxes are paid right out of our operating account.  Deposits to this account are funded only by sales/receivables from customers we invoice for our product.  It is not funded by other means.  We as a corporation truly pay income taxes to both the state and federal governments just like a working person pays taxes from income earned in their paycheck.

Why is this so hard to understand?  Do you think that all corporations skate paying taxes?

Gina

[Merlin the Elder]

Just my cheap 2 cents.  Corporations do indeed pay taxes.  The corporation I own pays estimated quarterly tax to the PA Department of Revenue (form PA-40ES) and to United States Treasury (form 1040-ES).  The estimates are based on our current sales/receivables and the safe harbor from the prior year.  The checks come out of our operating account.  How is that not paying tax? 

Gina

Sorry, Gina.  I was talking about the really big corporations — the ones that are in the news for not paying taxes. There are lots of smaller corporations that are the backbone of middle-income America. I know most of those are paying taxes. But there are a lot of crazy loopholes for them, too, for those in a position to take advantage of them. Middle-income America doesn't have enough money to buy their way out of the taxes like the very wealthy do, and yes, I know it's not all of them, but it most definitely goes on.

It's painfully obvious that things aren't working, and they haven't been for many, many years. Tax breaks should never have been implemented while the US had debt—any debt. Taxes should most definitely be more equitable, and less arbitrary. "Use" taxes are probably the most fair. Sales tax and fuel tax are two good examples. "Sin" taxes are the least fair. Taxing something because you don't like it is just plain stupid, unless the entirety of the tax revenue goes to mitigate the effects of the "sin." Unfortunately, those effects are usually ignored when the money is doled out.

Like Sir Richard is saying, we're in for some deep poo!  In response to Sir Richard regarding the unemployment rate, as a scientist by training, I must only accept statistics that are consistent in their determination. I'm not saying that you're incorrect...I know what you are referring to and totally accept that as being true. However, I must compare apples to apples, and the methods remain somewhat statistically accurate overall.

I don't know the solution. There are probably only a handful of people on the planet that can describe the exact solution, and none of them are in Washington. I must reiterate that this has absolutely nothing to do with political parties. I don't care what party you are, if you have a logical solution. This is the effects of several decades of oblivion by the people we have chosen to lead us. We "hire" (vote for) mostly lawyers when we should be putting successful businessmen — ones that made it legitimately — or economists into power.

[Zaubon]

These taxes are paid right out of our operaterating account.  Deposits to this account are funded only by sales/receivables from customers we invoice for our product.  It is not funded by other means.  We as a corporation truly pay income taxes to both the state and federal governments just like a working person pays taxes from income earned in their paycheck.

Why is this so hard to understand?  Do you think that all corporations skate paying taxes?

Gina

Yes you pay taxes, but because of those taxes your expenses are increased. Those expenses (taxes) along with all other expenses necessary to operate your business are passed along to your customers in the prices you charge. As Keeper said, if you didn't pay those taxes your expenses would be lower and thus your prices could be lower and still maintain the same profit. We won't even discuss the increased expenses derived from the increased accounting to properly track and pay those taxes.

Zaubon

[arbcoind]

If no one paid taxes they would have more $ to spend.  That's pretty simple.

Gina

[arbcoind]

Double post!

@ Merlin, no offense taken.  I know very large corporations can avoid paying their fair share of taxes.  We are small, 40 employees and have no loopholes.  We spend $ on equipment and capital expenditures for the tax breaks those offer.  I prefer to run an honest business...couldn't sleep otherwise.

@ Zaubon:  We price our products based on cost of sales.  Taxes fall under "other expenses" and are never factored into cost of sales.  My CPA wouldn't allow it.

Gina

[SirRichardBear]

Merlin the Elder as an Engineer of many years I've learn to look at the statistics and if they don't match the data I'm seeing on the factory floor throw them away and look toward the reason someone has screwed the statistics.  Normally its to hide a mistake they have made or to make themselves look better than they are.   Which is what the government is doing with the unemployment statistics.  They problem is till people stop excepting the government data as good and start demanding good data we are not going to get any were near finding a solution to our governments problems.

[Auryn]

I agree with just about everything said here, but I think everyone gets sidetracked by the taxes discussion and thats how the politicians like it.
Like it or not, even leaving tax rates the way they are, the problem is still government spending and the mismanagement of funds.

How about bringing home all our men and women in uniform putting their lives on the line for ingrates that don't want us meddling in their affairs to begin with?/
No one appointed the US to be the neighborhood bully that tells everyone what to do and how to do it.

On another page, how about we remove the 100% government aid to people who conveniently seek 'political asylum' and get their entire life style paid for by the governemnt- case in point- cubans. Maybe because I live in south florida I have a more personal view point on it.
But explain to me why its fair that any random cuban can make it to the US and the government forks over hundreds of thousands of dollars to them while my boyfriend who spilled blood defending other countries while serving the US just had his tuition coverage lowered to 90% through the GI bill and they won't pay for summer classes.
He sacrificed for his country, he EARNED his GI bill money, and now they are refusing to give it to me.
I as a 29 year old female US citizen have to pay through the nose to have medical insurance- even more if I want the insurace to cover maternity expenses, but a cuban immigrant has 100% free health care coverage including maternity.
Oh and me- as US citizen with my own small business (all of 1 employee- me) can't get a loan to buy my first home but a cuban gets a crazy low rate mortgage to buy a $250K home and then 2 years later can get another to buy a SECOND home that he can rent out.

I'm not pulling this out of thin air- the things I listed above I know for a fact about people that I know personally that I work with every day.

Explain to me why we provide all kinds of money to foreigners but can't take care of our own military people??
There are plenty of places we can start cutting from the budget before we cut education or employment.


Oh and yesterday, I was listening to NPR and the 'economic' commentators where actually complaining that the starting salary at the new VW plant in Tennessee is going to be $27.00 instead of the $52.00 that they USED to pay in Detroit.
I am pretty sure that the cost of living in Tennesee- even in the city- is considerably less than it is in south florida and there is not a single business down here where the starting salary is anywhere near $27.

[arbcoind]

All good points Auryn.  Our government wastes money.  If I wasted money like that, I'd starve. 

My employees would walk from PA to TN for $27 an hour.  Is that figure the base wage or does it include their benefits as well? 

Gina

[Merlin the Elder]

As I said, Sir Richard, I know there are isolated spots where unemployment is terribly high. I know that statistics for unemployment are also skewed. But they have always been skewed the same way. That's all I meant by the "apples-to-apples." In your area, unemployment may be crazy high. Around here, it's not.

The cost of the mistakes have been accruing interest—literally—for decades. To lay the problems of today at the feet of one or two administrations totally defies logic and reality. To suddenly, and drastically, change some of the things that are on the chopping block would have disastrous and long-reaching effects. More recent increases in expenditures show be reduced first, as they would have the least negative effect. The sacred cow that nobody wants to touch is the one that needs to be brought under control. Even the Secretary of Defense has stated that too much money is going to defense.

Auryn, mismanagement is right. It's happened with some of the big corporations (i.e., auto manufacturers), the government, especially, and in plenty of cases, individuals. Although I am not crazy about the government having excessive control over individuals, which is increased exponentially since 9/11, I do feel like the American people would have been much better off had the government not eliminated controls over banking and other industries. Middle America is who have suffered the most from bank and market collapses, large corporations going bankrupt with the CEOs, CFOs, COOs, et al walking away with millions of dollars, and the "little guys" losing their entire retirements, their jobs, and having absolutely no recourse.