Opinion: McClintock is wrong about corporate taxes
By Patrick Stelmach
Tax dodging is unfair and unpatriotic. The United States of America is home to the most successful corporations in the world, because we are the land of opportunity and equality. However, these values and freedoms are being eroded by tax dodgers.
A small group of corporations exploit loopholes in our tax code by shipping profits to offshore bank accounts to avoid paying taxes, cheating the American people out of$150 billion a year. When anyone dodges taxes, it adds to the deficit and the burden imposed on hard-working, tax-paying Americans through cuts to education and other programs.
Volunteers with California Fair Share collect signatures. Photo/Provided
We can begin to balance our budget and build a stronger economy by closing tax loopholes and ensuring everyone pays their fair share.
Rep. Tom McClintock, R-Granite Bay, would rather keep giving tax breaks to corporations and the wealthy than properly fund our schools and support the middle class. During a town hall meeting Wednesday evening, I asked Rep. McClintock if he would close the corporate tax loopholes and put that money towards education and paying down the debt. Rep. McClintock said he would only end the loopholes if that money were given right back to those corporations through lowering tax rates.
All corporations should pay their taxes like the rest of us. If we close corporate tax loopholes and lower corporate tax rates by the same amount, as Rep. McClintock proposes, we are still letting corporations get away without paying their fair share in taxes.
While the top corporate tax rate is 35 percent, most corporations pay much less in taxes due to loopholes, deductions and subsidies. Total corporate federal taxes fell to 12.1 percent of profits earned from activities within the U.S. in 2011 – a 40-year low, according to the Congressional Budget Office.
Some corporations, like General Electric, paid no taxes to the federal government for several years, because the company aggressively exploits loopholes and ships much of their profits to foreign bank accounts in countries like the Cayman Islands.
Across-the-board cuts, called the sequester, are set for March 1, a prospect that is scaring economists and local leaders alike. The sequester, it is estimated, will have numerous impacts, including a loss of one million jobs and small business loans reduced by $540 million.
With Congress trying to reach a compromise between Republicans and Democrats, Rep. McClintock should do everything within his power to ensure the final budget deal closes outrageous corporate tax loopholes to help reduce the deficit and pay for national priorities.
Patrick Stelmach is the state organizer for California Fair Share, a statewide, grassroots field and advocacy group, working to provide every Californian with a fair shot, make sure everyone pays their fair share, and that everybody plays by the same set of rules.
“Fair Share” is liberal speak for stick it to the rich…or anyone that is successful. While there are certainly examples of corporations using the complicated tax codes to pay less taxes, the majority of small companies pay the highest corporate tax rates in the world…so most company owners take it as regular income instead, and now of course here in California the combined state and federal tax burden for high income earners will be over 50%. I’m sorry, I don’t earn anywhere near enough to pay those high rates, but I still believe there is nothing fair about anyone having to pay over half their income in taxes, while those in the lower income brackets pay no income taxes. Aside from fairness, if you tax people to death they go somewhere else to earn a living…another state, another country.
Publicly traded corporations hire lobbyists to in effect bribe our politicians into creating the unfair advantage over small business.
One very damaging recent change in the law was the changes that our government made to the patent laws in 2011. 50 years of standards that favored the inventor swept away with the stroke of a pen.
Did you hear about that? Not surprised very hush hush in effect it changed the system to favor the rich over the inventor.
I’d like to hear Tom McClintock’s opinion on that issue.
What is tax dodging? Following the tax code set by the Federal Government? That’s not what I call it.
Hiding money illegally is what I call tax dodging.
Do you know people who work for cash and don’t report it? That is tax dodging.
The comment about money being shipped to foreign accounts is not true. If the profits were earned within the US, taxes are paid on that which is liable. If profits are made outside the US, taxes are paid to the country in which they were earned but if the profits are brought back to the US then it becomes taxable again, so why not keep it outside the US?
The GOP hate welfare……unless it’s corporate welfare.
Tommy boy has no vision. He is great on all the Republican talking points, but is not a free thinker. Vote him out ASAP.
Personally, I trust some of the uber rich (Gates, Buffett, to name a couple; Ellison is also a democrat) who believe corporations are getting away with murder and should be taxed more. That is not liberal speak as much as it is common sense coming from some honest rich folk who do not believe hiding a few more billion in their mattress is all that necessary. Gates, Buffett and Ellison are part of the uber rich crowd that is giving away at least half of their wealth while still alive. They are patriotic Americans.
Rick
Its not a loophole at all. They are following the law, if the law allows them to do an action, a corporation is obligated to do whats best to return the most money to their investors.
But in my opinion all corporate taxes should be completely tax exempt. Instead tax the capital gains and dividends of the owners. If each person gets a 1099 there is no loophole or tax dodging. This also avoids double taxation.
What is double taxation? Corporation pays a tax on profits and gives some money to the owners, who pay tax on that money that has already been taxed. Sucks and that’s why corporations are given such tax breaks.
I think the guy is talking about the FSC’s that have been gone for over a decade. I am sure he has no idea what he is talking about. But there is no way to figure out what he is offended by.
Rick, you have completely misquoted Gates and Buffet and then come to incorrect conclusion from your misunderstanding. Gates and Buffett believe that increasing tax rates should be a part of getting out of our debt problem. And we do have a major debt problem. Niether have said anything like they believe corporations “get away” with anything.
We have double taxation in this country. That places dividends at the highest tax rates in the world. I think that is probably enough.
On the contrary John, we essentially are saying the same thing. Buffett has indicated on numerous occasions over the last several years that corporate tax rates should be higher. He has explicitly said over the years higher tax rates will not adversely affect corporations like his.
He noted the following at the end of 2012:
But Warren Buffett, the Oracle of Omaha, told CNN that he does not think the U.S. will go into a recession. He also thinks president Obama is right in trying to raise $1.6 trillion in revenue:
“We need $1.6 trillion. We need to get our revenue up to about 19 percent of GDP, and we need to get our expenses down to 21 or 21.5 percent of GDP. Everyone knows that. So it’s going to take significant action on both sides. And $1.6 trillion happens to be 1 percent of GDP, we’ll need that much revenue, and we’ll need to cut expenditures significantly too.
He has argued for a number of years (not recently but nearly a decade ago) that corporate tax rates should be higher and CEO’s compensation packages should be much lower.
Rick
tax the churches!!!!
Good idea, let’s start with taxing scientology, I think we can all agree that is completely made up and for profit.
Do you know what the difference is between a religion and a cult?
If you know the name of the person who wrote the book, it’s a cult.
Thingfish,
Matthew, John, Leviticus, Mark, Luke, Daniel etc.
We know who wrote that book. No author listed for The Urantia Book. L. Ron’s best book was probably Battlefield Earth. Horrible movie though.:-). The difference between a religion and a cult is there is none! It simply depends on which side of the fence you are on. Stopping ridiculous tax breaks for corporations is the right thing to do. Don’t raise rates, just end the politically issued loopholes for the G.E.’s who pay nothing and see what happens. If they think they will be better off in other countries, let them go. But don’t let them do any business in the U.S. See how they like them apples.
pretty much everything that McClintock represents isnt worth anything to me. He is about the worst rep. there is, he only represents himself. I think its time to vote him out and let him fend for himself. Good riddance to bad rubbish!!