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Corporations thirty years ago or so contributed over twenty percent of the tax revenues collected by our IRS. That number is now only seven percent.Presumably this has come about in part because of the modern ability with computers to instantly reallocate costs, profit centers and scheme like deductions on a global scale.
It has also come about as the hordes from K Street each win a tax break here and a tax break there from their future brethren now sitting in the legislatures.
My proposal is a variable corporate tax rate.
First, set the percentage of total USA taxes required from the corporate sector (for example let’s say 12%). Then on a past year or past quarter rolling basis inform the corporate tax payers what their tax rate is; the rate necessary to meet the 12% goal.
Doesn’t this seem a fair way (as a citizen) to establish a countervailing power to the hold Corporate America has over the taxing powers, i.e. all legislatures?
If you’re economically geeky you may also appreciate a beautifully humorous scenario unfolding from this plan.
If the total amount of taxes to be paid is a set sum per period, then, when one company or one industry negotiates a large tax reduction this will cause the other corporations and industries to pay additional taxes to meet the set goal. Tax boondoggles become a competitive endeavor with each lobbyist’s gain a loss to a competing K Streeter.
Not only is there a smiley thought in envisioning members of the Armani suit cross my palm with lucre K Streeters being at each others throats as they compete to buy favors but tax cuts would have to pass a rigorous economic cost benefit analysis to meet approval.
Well, gee, that’s kinda funny too and somewhat novel.
(Next week: "Capping Pork Proposal defeated by chorus of squeals")
