Taxes

Let’s take care of Inky (Enky seems to be the more used spelling, I will make the change). Here is Rosen’s page and the IRS page I assume he got the information from, there is also a reference to another group, don’t have a clue who they are, you can bet they are anti tax. As far as I know Rosen and Knarly are the only two relevant in this thread that have an economics degree. I can use the four functions on a calculator, but anything over about 9th grade math and I’m stumped.

http://www.koaradio.com/pages/shows_rosen.html?feed=119739&article=2777167

http://www.irs.gov/taxstats/index.html

Now to the taxes:

Let me start of by saying I don’t know where you got the idea I was against taxes in general. I’m not. When I used to backpack a lot there was an adage; take all the things you absolutely need, all the things you would like to take but don’t need, and all the things you don’t need at all and put them in three piles. Take the first pile, put it in your pack and leave the rest home. When it comes to all the things government can provide us I think we all agree there are some things government has to provide. National defense, police protection, a court system, a minimum level safety net for the poor, that type if thing. On the other end of the spectrum is the ultimate goal of communism, where the government controls all our lives from cradle to grave. None of us are advocating either of those extremes, we are discussing what we are going to take from that middle pile for our backpacking trip.

My want for corporations to pay no taxes is no more realistic than your hope for a world without war, I realize this, it is a utopian dream, but what the heck. If this dream were to come true, it would not be to reduce taxes out alone eliminate them. Individual taxes would have to be increased to make up the difference. The purpose of my wanting to eliminate corporate taxes is that I consider them to be a “hidden” tax, and I hate hidden taxes, don’t tell people their tax rate is 20% when it is 40% when everything is included, they need to look at their paychecks and see 40% taken out.

I’ve explained how the tax structure works in simplified terms and at Knarly’s request I am trying to keep this short, so ask questions. (after finishing, I realize I failed to keep this short, keep reading, it’s worth it)

To Knarly’s question about the summer cottage we refer to as a “research facility” (RF). In the United States we have a voluntary tax reporting structure, you fill out a few rather broad categories on your tax return. Random audits are done to determine some baselines and if your return falls within those guidelines no one questions it. What keeps everyone honest is the realization they may be picked for one of those random audits. So we all keep boxes of documentation in our file cabinets. The answer to you question is I don’t think it would make any difference one way or the other. In today’s system the RF is billed as, well, an RF. Some of the best ideas come after a couple scotch and waters in the hot tub they say. Unless an IRS agent pours over the documents for a month no one is going to know. In my system no one cares if the company owns the RF, but if it is not really being used for legitimate research it should be listed as wages to someone. If it isn’t then it will still be up to that pesky IRS agent to find that it wasn’t. Crooks will find a way to skirt the law. What I like about this idea is it eliminates “corporate welfare” there is nothing to deduct if there is nothing to deduct from. I have seen so many corporate decisions foolishly made for tax reasons. I have seen truck loads of perfectly good components destroyed because the company didn’t want to pay taxes on those items. That is a “green” problem we can address with a stroke of a pen.

What money isn’t used for legitimate expenses and isn’t used to pay dividends simply sits in an account ready to be used if a new drug looks promising or a new form of energy can be developed. I don’t care if a company has billions in its coffers, leave it there. But of course greed from any number of people including investors, politicians trying to buy a vote, and folks smart enough to run a company will never let that happen. It’s utopia.

And so it goes…..

Linda Ellerbee