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Trump's Tax Plan Bleeds Red Ink and Does Not Focus on Job Creation

By   Follow Me on Twitter     Message Joel Joseph       (Page 1 of 3 pages)     Permalink    (# of views)   No comments

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opednews.com Headlined to H3 4/28/17

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President Trump is proposing a 15% tax rate for corporations across the board, with the individual tax rate up to 35%. Why should a corporation pay a lower rate of income tax than its employees? The corporate tax rate is now 35% and the maximum individual tax rate is 39%. The Supreme Court has ruled that corporations are people and entitled to the same constitutional rights as people. So shouldn't people be entitled to the same rights as corporations?

President Trump's tax proposal will bury the federal government in red ink by lowering corporate taxes across the board. My proposal is revenue neutral and targets tax incentives aimed directly at manufacturing corporations that we want to keep in the United States or bring back to the U.S.

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Mr. Trump claims that the U.S. has the highest corporate tax rate in the world. This is not quite accurate since that although the nominal corporate rate is 35% the actual, real world corporate tax rate is closer to 15%. According to Americans for Tax Fairness, General Electric, Boeing, Verizon and 23 other profitable Fortune 500 firms paid no federal income taxes from 2008 to 2012. The organization also found that 288 big and profitable Fortune 500 corporations paid an average effective federal tax rate of just and that profitable corporations paid U.S. income taxes amounting to just 12.6% of worldwide income in 2010.

Concerning corporate taxes, I propose the elimination of loopholes and a corporate tax rate of 28% with a zero tax rate for manufacturing companies. I also propose a 14% tax rate for income earned overseas to bring home $2.6 trillion of profits sitting in corporate accounts offshore. I would also cap personal taxes at 28% as well, with no deductions, except the personal deduction.

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Loopholes

Many corporations use every tax loophole to avoid paying taxes. As a part of tax reform all of these loopholes should be closed. All income should be treated the same, with one exception. The exception is income from manufacturing. Manufacturing is the industry that has moved offshore, for cheap labor and for low tax rates. Your local restaurant, dry cleaner and retail store cannot move offshore and does not need special lower tax rates: they cannot move offshore. The President's industry, real estate investment, is built on loopholes, including depreciation. Real property does not depreciate; Depreciation is a myth. Improvements and repairs to real estate should be deductible, but depreciation should not be deductible from income.

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Tax Amnesty for Reshoring Profits

There are also more than $2.6 trillion stashed overseas by major American corporations, including Microsoft, Apple and Google. We should allow these dollars to be repatriated at a reduced rate.

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Chairman, Made in the USA Foundation, economist and lawyer, author of ten books and hundreds of articles.

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