Now that Japan lowered its own taxes,
the U.S. stands on top with the dubious distinction of having the highest corporate tax rates. Claims that, when you consider
all the tax loopholes, subsidies, deductions and tricks, the effective rate is not really the 35% level seem less reassuring.
However, if you view any tax policy that focuses upon revenue collection, you miss the entire significance of the dynamics
in trade. The slogan "Free Trade" applied in real terms, means capitulation of domestic production and prosperity
for the sake of maximum international return on equity. In essence, the global corporatist supersedes the home domicile country
for the joy of worldwide plunder.
The United States runs away from these hard cold consequences out of some distorted
motivation to become a programmed society, connected to Asian computer devices that broadcast the social destructive culture,
while destroying the work ethic. Not all countries admire or model their economies accordingly. Reflected in their internal
tax policies, there is a sharp contrast to that of the Uncle Sam stamp – No Longer Made in the USA.
As the country
weakens and the industrial foundations crumble, the excuses multiply. What do other countries understand that evades the mindset
of those who cannot grasp the supply and demand equation?
Corporate Taxes: Comparing Effective
Rates You Tube offers a short lesson on tax rates. How can America survive when the tax
system is targeting companies for demise? The reason many productive enterprises look to oversea locations for continuing
their ventures rests upon the strategic need to escape the un-competitiveness of a tax system that favors foreign operations
at the expense of domestic production.
Keeping the door
wide open for tariff free imports transfers the business operations to foreign lands. This pattern guarantees that expansion
and future development continues outside our nation. This new wake-up call deserves a rational response that revamps the entire
tax rules.
"After April 1, America’s unfortunate
'leadership' in corporate taxation will inevitably lead to declining international competitiveness and increasing burdens
on job creators," said James Pinkerton, Co-Chair of the RATE Coalition and former White House domestic policy adviser
to Presidents Ronald Reagan and George H.W. Bush. "Our corporate tax code, which is currently the world’s highest
at 35 percent, will deter companies with much-needed capital from investing in America and instead they will invest and hire
abroad, shifting U.S. jobs overseas."
This
conclusion is obvious, but you hear few solutions to repatriate the hordes of profits that American foreign subsidiaries shelter
off shore to avoid U.S. taxes. Missing in the discussion is that companies registered to do business in our country to sell
their products or services require an incentive to make their items domestically. That inducement should be lower taxes to
run and invest in domestic facilities, along with the accompanying employment that flows from such operations. Conversely,
there should be a substantial penalty to manufacture in foreign countries and get a first class ticket to ship their items
in container vessels to flood the American marketplace.
Corporate Taxes: Advantages
of a Territorial System video provides a clear explanation of an alternative method of repatriating
foreign funds. This taxing option does not resolve the dramatic assault of imports based upon cheap labor. Since the decision
to open relations with Red China during the Nixon era, the movement to de-industrialize America developed to perfection. Yet there are winners in this new global dominance. One familiar name if GE. The
article, Who wants a higher corporate
tax rate? G.E. does!, has an interesting twist.
"G.E. faces many different competitors in many different
industries which makes finding an advantage that would make G.E. more competitive across all of them difficult. One such advantage
can be provided through corporate taxes. G.E. has mastered the combined use of tax code loopholes and hordes of lobbyists
to game the corporate tax system. As a result, the company has paid an income tax rate that averaged 2.3% over the past 10
years. If the corporate tax rate increases, it is unlikely that G.E. will give up its campaign to avoid taxation. It is much
more likely that it will redouble its efforts, and judging by its past success, I doubt G.E. will end up paying what President
Obama refers to as its "fair share."
Can the same be said for
G.E.’s competitors? Probably not. The vast majority of them will end up paying the higher tax rate while watching their
competitor remain unscathed once again. This would be G.E.’s dream weapon, a tax rate that weakens its competitors across
all industries."
The point is that huge conglomerates,
especially politically connected, that act as if they are too big to fail, discourage independent domestic businesses.
The last secret factor that a global empire seeks to disguise is that collecting corporate
taxes is secondary, because of the world’s reserve currency status, to the systemic export of vibrant domestic industrial
base.
The definitive consequence of having an uncompetitive corporate
tax rate provides a substantial barrier for entrepreneurial activity. Tax policy can encourage the natural motivations to
take risks and reward diligent work. Adverse confiscation and structural prohibitions can kill the incentive to create enterprises.
Sensible reductions in all taxes can invigorate the economy.
Corporations
are not people and should not enjoy the protections of constitutional personhood. However, the corporate tax rates needs to
reflect the commitment to rebuild America. In the end, the consumer pays the tax. It is time to earn the benefit from goods
and services produced throughout our own country.
Balancing the scales
of world market commerce means that "Fair Trade" must replace the tragic consequences of the current imbalances.
