In 1940s corporations paid 43 percent of all federal income taxes collected in US

Discussion in 'Politics' started by walter4, Apr 12, 2011.


    April 5, 2011

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    How can we reconcile the simple fact that Americans are living in one of the least taxed countries in the developed world with the reality that many working people feel they're being “taxed to death”?

    Well, consider this: in the 1940s, corporations paid 43 percent of all the federal income taxes collected in this country. In the 1950s, they picked up the tab for 39 percent. But by the time the 1990s rolled around, corporations were paying just 18.9 percent of federal income taxes, and they forked over the same figure in the first decade of this century. We – working people – paid the difference.

    That's because the share of our economy represented by government spending has varied by only a small margin since the 1950s, regardless of which party held Congress or the White House. With a pretty consistent picture on the spending side, every time corporate America lobbies for another tax break or loophole for the benefit of their shareholders, they are effectively raising taxes on American households – on the 90-plus percent of the population who get most of their income from wages rather than investments.

    The shift of all these taxes from corporations to individuals and families has been pushed with the help of a Big Lie – growing from a small kernel of truth – told by corporate America, its lackeys in Congress and the media it dominates just about every day: that American companies face some of the highest taxes in the world.

    The kernel of truth is that, at 35 percent, we do have one of the highest statutory corporate rates in the world – that is, the rate that's written down in the tax code. But what's written in the tax code is inconsequential compared to the number written on checks sent to the IRS.

    What US companies actually pay in taxes is among the lowest figures in the developed world. The effective tax rate is what companies actually fork over. As the non-partisan Center for Budget and Policy Priorities (CBPP) explained, the 35 percent rate the corporate mouthpieces on CNBC are always whining about “does not take into account the generous depreciation rules, exemptions, deductions, and credits (some of which are sometimes termed 'loopholes') that corporations may be eligible for.”

  2. Zero corporate tax should be the goal