U.S. corporate tax rate discourages job creation

[PJABBER]

I am looking forward to the Jobs Summit coming to Washington in a couple of days, and I hope that all of the Obama Administration poobahs listen carefully to not only the dire descriptions of the economy that are sure to be made, but also to any private sector proposals which might address the underlying issues.

I particularly hope that the government's corporate tax policies are challenged early and often. Studies have shown the United State's current world-leading high taxation rates to be the single most harmful element to long term job growth.

How much more onerous are US tax rates than those of other industrialized countries? The Tax Foundation released a study a couple of months ago updating the relative standings -

http://www.taxfoundation.org/files/ff184.pdf

What is truly frightening for the prospects of job creation in the U.S. is that the Congress and the Obama Administration willfully ignore the effects of onerous taxes and the severe impact these place on private sector hiring.

Unless there is a 180 degree turn in the thinking of our government, we can look forward to ever fading prospects for a rebound in private sector employment.

*****************************************************

http://www.foxnews.com/search-results/m/27648556/max-tax.htm

Transcript (automated, so it is not word for word accurate, best just to watch the short video interview):

"Washington makes job creation a top priority. Tax experts though say the United States has one of the worst tax policies in the world when it comes to creating new jobs. US corporations face an average combined tax rate of 39 point 1% that is the second highest rate among industrialized countries. Right behind Japan's 39.5% combined rate. Jim Angle is live for us in Washington Jim. Most people think Europeans and and other major economies have higher taxes than we do but I guess in this one key area that's not true."

"There's so a big misconception that Europe has much higher tax rates the United States. And that's no longer the case in many aspects. Especially when it comes to corporate taxation. Europeans and in particular have much lower corporate taxes than the United States. "

"US has including state taxes so corporations about 40%. Many of those in Europe have corporate taxes in the twenties and thirties. And a grouping of thirty major market economies known as the OECD. Which includes all the Europeans did a study of what the most counterproductive effects had been. And all those nations it identified the corporate income tax income tax as the most harmful for long term growth job."

"Interesting Jim that you found the what was once the world's biggest Communist economy has actually gone further than the US to try to reduce the tax burden on corporations. Yes it's interesting China the world's most populous nation and once a bastion of communism now has better incentive for job creation then the US does in terms of taxes. China looked at what worked in other countries. To encourage savings and investment, no tax on bank interest, no tax on capital gains on stocks listed on their exchange and perhaps most important have a 25% Corporate tax rate. Well below the US -- of 40%. So the former Communists are beating us at our own game. They wanted to lift a billion people out of poverty so they reduce the taxes on saving and investment and capital formation. And they're growing very very nicely in spite of the world financial panic. So China's a better example of freight labor markets in taxation that impedes job creation than the US is these days. They have found that cutting corporate taxes is the way to create jobs John."

" Jim Angle in Washington thank you. And if you'd like more information on this story and other on the job hunt features log on to foxnews.com. Go to the top of the page there click on where it says. On the job hunt."

 

[Ausm]

pretty short post.

 

[JSt0rm]

Thank you peaches. So you are looking for work now? D: And i thought they would always need analysts.

Yours truly,

The beast

 

[marincounty]

I'm fine with lowering corporate taxes, if the income taxes are raised to make it revenue neutral. A lot of European countries have lower corporate taxes but much higher personal income taxes. Be careful what you wish for. The UK, Portugal, Norway, Netherlands, Denmark, Turkey, Poland, Italy, Austria, Sweden, Germany- all have significantly higher income taxes.
They also have universal health care, removing a large burden from their corporations.
http://en.wikipedia.org/wiki/File:Income_Taxes_By_Country.svg

 

[heyheybooboo]

U.S. corporate taxes as a percent of GDP are at their lowest level since 1937.

Another Fail Post ....


(and do we have to go through this, again? The actual amount of taxes paid is significantly less than their 'rate')



-

 

[EagleKeeper]

I am sure that tax incentives into the business sector will cost less than the $x00,000 jobs that were saved/created by the recent stimulus

 

[fskimospy]

U.S. corporate taxes as a percent of GDP are at their lowest level since 1937.

Another Fail Post ....

(and do we have to go through this, again? The actual amount of taxes paid is significantly less than their 'rate')

-

/thread

 

[heyheybooboo]

I am sure that tax incentives into the business sector will cost less than the $x00,000 jobs that were saved/created by the recent stimulus

There are over $50 billion of 'business' tax cuts in the Recovery Act --- I'm guessing your are glossing over this fact to take a snarky, partisan jab because you have nothing of substance to offer.


-

 

[dmcowen674]

I am looking forward to the Jobs Summit coming to Washington in a couple of days, and I hope that all of the Obama Administration poobahs listen carefully to not only the dire descriptions of the economy that are sure to be made, but also to any private sector proposals which might address the underlying issues.

I particularly hope that the government's corporate tax policies are challenged early and often. Studies have shown the United State's current world-leading high taxation rates to be the single most harmful element to long term job growth.

How much more onerous are US tax rates than those of other industrialized countries? The Tax Foundation released a study a couple of months ago updating the relative standings -

http://www.taxfoundation.org/files/ff184.pdf

What is truly frightening for the prospects of job creation in the U.S. is that the Congress and the Obama Administration willfully ignore the effects of onerous taxes and the severe impact these place on private sector hiring.

Unless there is a 180 degree turn in the thinking of our government, we can look forward to ever fading prospects for a rebound in private sector employment.

Good, take you and your America hating asses out of here.

Real Americans and businesses that love this country will take over after your sorry asses are gone.

Obama really is a Messiah

Thank Mr President

 

[her209]

If Corp A can generate more money in revenues by adding a job than what it costs to add a job, its going to add the job regardless of what the corporate tax rate is.

 

[her209]

Obama really is a Messiah

Thank Mr President

Hahaha... Dave, you're a funny guy.

 

[ShawnD1]

I'm fine with lowering corporate taxes, if the income taxes are raised to make it revenue neutral. A lot of European countries have lower corporate taxes but much higher personal income taxes.

It's true. The taxation rates in the US are unbelievable when compared to other countries. US taxes start at 15% and quickly go up to 34% for profits over 100k.
Corporate tax in Canada is roughly 20%.
Australia, 30%.
Germany, 15%.

If Corp A can generate more money in revenues by adding a job than what it costs to add a job, its going to add the job regardless of what the corporate tax rate is.

Another thing that people forget is that income tax is only paid on profits. A company losing money still loses money even if the tax rate is 0. If someone is saying their business is failing because taxes are too high, it's actually more likely the business is failing because that person is profoundly retarded and wasn't filing his taxes properly (you're supposed to deduct your expenses so you don't pay taxes when you are losing money).

 

[nobodyknows]

I guess we should stop the obscene pay, bonus, and $400 million retirement packages then.

 

[sandorski]

Hmm, is it that Corporate Taxes are too high or the Fact that there are Billions of People willing to work for a Fraction of what an American is willing to Work for?

 

[Jhhnn]

Hmm, is it that Corporate Taxes are too high or the Fact that there are Billions of People willing to work for a Fraction of what an American is willing to Work for?

There you go again, referencing that ugly thing called "Reality"... lots of things "inhibit" job creation- SS taxes, unemployment compensation, minimum wage, workmen's comp. If workers were completely disposable, there'd be jobs everywhere, obviously, none of them worth having.

Too bad we can't offshore PJabber's trolling- I'm sure some Indian guy would do it for a fraction of what PJabber is getting paid to do it...

 

[glenn1]

If Corp A can generate more money in revenues by adding a job than what it costs to add a job, its going to add the job regardless of what the corporate tax rate is.

This is only true to an extent - an additional hire may generate revenues in excess of his payroll costs, but he wont' get hired if the company already has excess capacity in the job category, the division is losing money as a whole, the extra revenue doesn't reach profit hurdle rates for taking on the new business, etc. Corporate tax rates do play into it as well, since they in part affect what the marginal after-tax profit rate would be for any given business activity, which is a key determinant of whether a business would take on a venture (and thus the attendant hiring).

 

[shadow9d9]

GS is paying 1% this year. Yep, way too high.

 

[glenn1]

GS is paying 1% this year. Yep, way too high.

Because they're moving operations to lower tax jurisdictions, which supports the OP's premise.

http://firedoglake.com/2008/12/16/goldman-sachs-to-pay-1-tax-rate/

 

[nobodyknows]

Because they're moving operations to lower tax jurisdictions, which supports the OP's premise.

http://firedoglake.com/2008/12/16/goldman-sachs-to-pay-1-tax-rate/

So I guess we should soak the bastards as much as we can before they move everything out of the country.

Last year they paid 6 billion in taxes worldwide, this year they’ll pay 14 million. You, the taxpayer, will make up the shortfall, one way or the other.

 

[Hacp]

If Corp A can generate more money in revenues by adding a job than what it costs to add a job, its going to add the job regardless of what the corporate tax rate is.

Nice logic. I wonder where that job is. India or China?

 

[blackangst1]

I guess we should stop the obscene pay, bonus, and $400 million retirement packages then.

Oh God not this strawman again

 

[blackangst1]

U.S. corporate taxes as a percent of GDP are at their lowest level since 1937.

Another Fail Post ....


(and do we have to go through this, again? The actual amount of taxes paid is significantly less than their 'rate')



-

Let me ask you something. If net cost to do business is so low in the USA, how do you explain the reasoning of multinational companies moving production and operations offshore? Last time I checked a public company's main obligation is to it shareholders (as it should be). Lower operating costs result in higher profit to shareholders. So what, in your opinion, is your reason for companies offshoring?

 

[Bowfinger]

Let me ask you something. If net cost to do business is so low in the USA, how do you explain the reasoning of multinational companies moving production and operations offshore? Last time I checked a public company's main obligation is to it shareholders (as it should be). Lower operating costs result in higher profit to shareholders. So what, in your opinion, is your reason for companies offshoring?

Hmmm. Think, think, think ....

Oh yeah:

Hmm, is it that Corporate Taxes are too high or the Fact that there are Billions of People willing to work for a Fraction of what an American is willing to Work for?

It's those silly Americans thinking they're entitled to a middle class life-style far more than the taxes paid on corporate profits. Of course these same short-sided companies are probably bewildered at why their U.S. sales are softening.

 

[fskimospy]

Let me ask you something. If net cost to do business is so low in the USA, how do you explain the reasoning of multinational companies moving production and operations offshore? Last time I checked a public company's main obligation is to it shareholders (as it should be). Lower operating costs result in higher profit to shareholders. So what, in your opinion, is your reason for companies offshoring?

Labor costs are usually a business' #1 expense. Labor costs are much, much lower in other countries than they are in the US.

Regardless of what you think the cost is, here is the data. (and if anything corporate tax rates are lower now than in 2002)
http://www.cbo.gov/ftpdocs/69xx/doc6902/11-28-CorporateTax.pdf

As you can see, the US is around 30% lower than the weighted average and lower than nearly every country on the list. Corporate taxes are not our problem.

 

[Darwin333]

Let me ask you something. If net cost to do business is so low in the USA, how do you explain the reasoning of multinational companies moving production and operations offshore? Last time I checked a public company's main obligation is to it shareholders (as it should be). Lower operating costs result in higher profit to shareholders. So what, in your opinion, is your reason for companies offshoring?

He said taxes not expenses.

The taxes we are talking about are a very very small part of my expenses. My largest cost by FAR is labor. When you add up burden/insurance, benefits, and the actual labor costs it easily costs me well over $2 for every $1 I pay a man.

You know what I get for $2 in labor? Not a damn thing.

You know what you get in China for $2? A days work.

Then you have the complete lack of regulation in China versus our regulation here that adds significant costs. Hell, you could drop every tax we have and you still can't compete with the labor in China.