Why can't the government halve the corporate tax rates so it would get more revenue?

[Anarchist420]

I don't understand that.

The Federal Government would get at least 40B/year more in revenue. I know that may be only a drop in the bucket, but it will help.

They can keep all the deductions too, but having the corporate top marginal rate at 39% is too high, no matter how low the effective rate may be, it could still be lower.

 

[TheBDB]

Wait, what?

 

[EagleKeeper]

Without plugging holes, why do you think that the cutting the rate in will increase the revenue.

Please explain?

A company does not increase revenue based on taxation. If increase revenue based on demand.

 

[CycloWizard]

The only rationale I can think of for the OP's statement is that the marginal ROI will increase as taxes decrease, thereby stimulating private investing. The more they spend, the more they stand to gain. Thus, rather than sleeping on dollar bill-stuffed mattresses, their capital would be flowing again. Of course, halving the rate means that the result of this reinvestment would have to more than double the gains made to recoup the difference in tax revenue.

 

[jman19]

Another wonderful Anarchist thread... didn't even both to present a study as back up.

 

[techs]

Yeah, just like cutting taxes will increase government revenue.

Sheesh. The OP didn't drink the kool aid, he made the Kool Aid.

 

[BoberFett]

As much as I despise federal taxes of any kind, the corporate tax is the one I care least about. A high corporate tax pressures a company to pay out as profits to owners and taxed as income (assuming that system was working correctly) or investing in growth. A low corporate tax rate would simply encourage the building of massive corporate warchests.

 

[soundforbjt]

Not to mention, the number of large companies that pay NO taxes at all now. If they paid their fair share we'd have alot more money.

 

[CallMeJoe]

Why doesn't the government eliminate the corporate tax so it would get infinite revenue?

 

[Throckmorton]

Because the Laffer Curve doesn't work like that. It's not magic.

OP, you bought into Reagan's Voodoo Economics.

 

[SunnyD]

Why doesn't the government eliminate the corporate tax so it would get infinite revenue?

Division by zero != infinite.

 

[DaveSimmons]

Division by zero != infinite.

True, but a rate of 0.000000000001% would increase revenues a trillion-fold, right?

 

[SunnyD]

True, but a rate of 0.000000000001% would increase revenues a trillion-fold, right?

I didn't count the decimal places, so I'll just take your word for it. :thumbsup:

 

[Anarchist420]

Why doesn't the government eliminate the corporate tax so it would get even more revenue?

Good point, but I'm trying to be semi-realistic. It's the government we're talking about here.

Anyway reducing the corporate tax would bring in more revenue because personal income is taxed at a higher effective rate than corporate income.

BTW, I wouldn't want the government to have infinite revenue.