Zombie Economic Bullshit Can Never Die
I happen to know Dave Lawson. Nice guy. But this is just sad.
“Hi, I’m Senator Dave Lawson.
“You may have heard in the news recently that Burger King merged with a Canadian company. By doing so, Burger King, incorporated in Delaware, can move its corporate address to Canada to take advantage of the lower tax rate.“This growing trend is called a tax, or corporate, inversion. And it’s perfectly legal, for now.
“Delaware Senator Chris Coons teamed up with fellow Democrats Chuck Shumer of New York and Dick Durbin of Illinois last week to introduce a bill that would deter this type of tax evasion. While we’d all like to see American companies keep their headquarters – and their tax dollars – right here, this is not the way to do it. It’s just another short-sighted, quick fix.
“Bottom line, Coons’ bill – and others like it — fails to address the real root of the problem, which is the need for a complete overhaul of our nation’s outdated tax code. Democrats and Republicans in Washington need to get on the same page before we drive even more businesses away.
“As a nation and right here in Delaware, we need to create a more competitive, and fair, job climate, one that includes lower taxes and energy costs. Since 2008, the state has continued to increase taxes: Income tax, estate tax, corporate tax, renewable energy tax, energy surcharges and gross receipts tax and more have all gone up. This STOPS jobs!
“Whether they are Fortune 500 companies incorporated in Delaware, or your local corner store, shouldn’t Delaware be business friendly? When we reduce taxes and energy costs, we will create the jobs we so desperately need. Thank you.”
All due respect Senator, where is your proof? I know you’ve heard that cutting tax revenues creates economic growth – but can you point to an actual instance of that happening?
Dave seems to have missed the fact that Walgreens just decided to incorporate in Delaware, not leave the country.
And there is a difference between being “business friendly” by having a strong transportation infrastructure, good schools, clean water, and a functioning corporate court system, and being “business friendly” by handing out hundreds of millions in tax-payer funded subsidies, tax breaks, and grants to multi-billion-dollar corporations when over 25% of our citizens are on Medicaid or food assistance.
Exactly. A pro-growth tax policy would encourage investments. Right now we are only encouraging profit taking.
Besides, BKs current (as of 2013) effective tax rate is 27%. Tim Horton’s is 26.5%.
This isn’t about business-friendly, this is about increasing margins in a business where you won’t get much more from the stuff they sell every day.
There’s nothing about the current code that stops jobs at the level of BK. And ever notice how none of these smart guys ever has a proposal for the “overhaul of the corporate tax system”? I still think that they should scrap the whole thing and then institute a 12% tax rate across the board. No more deductions or expensing, no more tax credits for anything. Then we sit back and watch the big accounting firms and tax lawyers go into the biggest lobbying effort of their lives.
I like it. With what they’d be saving in accounting and lawyers fees to construct elaborate tax dodges, many large companies could come out ahead.
Right. And after tax simplification puts thousands of accountants and lawyers on the unemployment rolls, you can bet there will be little trouble convincing Congress to support a perpetual extension of benefits … the deficit be damned.
And maybe as a Libertarian I shouldn’t be mentioning this, but facts are stubborn things:
According to Senator Lawson, Canada has a “lower tax rate” for corporations (cassandra, leave your criticism of that aside for just a sec).
So is that how Canada funds its national health care system, from all the extra revenue generated by low corporate tax rates?
On the other hand I think cassandra’s 12% no exceptions rate should be called “the Corporate Flat Tax” except that might be illegal ’cause I’d be making a lot of people’s heads explode.
@mediawatch-
I agree. No one earning $500k/yr or more wants anything to do with REAL “tax simplification.”
Real tax simplification would hurt those people. And those people contribute to political campaigns!
“Simplification” does not mean a single rate. It means removing preferences or marginal utility.
“Simplification” does not mean a single rate. It means removing preferences of marginal utility.
“Simplification” means pretty much anyone who wants to make a proposal wants it to mean. It isn’t as though there is a real framework that any of them are advocating — except to pay less in taxes AND maintain whatever government subsidies they get now.
My own proposal gets them to the much vaunted Irish rate of corporate taxation AND gets them all to actually pay taxes.
media watch you hit the nail on the head
I don’t want to see US tax laws having to compete with desperate 3nd would nations for a race to the bottom. This does not serve the nation but serves the 1%
@m “I don’t want to see US tax laws having to compete with desperate 3nd would nations for a race to the bottom.”
Just put in a minimum tax requirement for all corporations doing business in the US. If they want to pay less than that minimum to a 3rd world hole, they can sell their stuff there instead of here…
Result? No more race to the bottom.
Works for me but there’s all of this BS out there about how we have to lower corporate taxes..
You think I’m worried about Burger King? Where was all the outrage, when HERSHEY (another Delaware corporation since 1927), went South of the Border and nearly threw an entire town in panic, and one heck of a social behometh Milton Hershey School into a tailspin? Now that was an Americana crisis.
Not that I want to see anyone go….but really Burger King only manages regional market share in some areas…..but those Hershey Kisses are everywhere!!!