Not content with imposing the highest corporate tax structure in the “free” world, Democrat hacks in the legislature are now asking the Imperial President to unilaterally take action. A group of tax happy corporate protectionists are hoping the President uses his "pen and his phone" to start punishing American businesses that have the audacity to lower their corporate tax burden.
Elizabeth Warren (D-Mass), Dick Durbin (D-Ill), and Jack Reed (D-RI), have crafted a letter (yeah… It took three of them) to President Obama requesting that action be taken toward businesses that have sheltered themselves from some US taxes. According to the Hill.com:
Sens. Dick Durbin (Ill.), Jack Reed (R.I.) and Elizabeth Warren (Mass.) told Obama in a letter Tuesday that he should do all he can to discourage “inversions,” in which companies that do work in the United States shift their headquarters elsewhere to avoid U.S. tax rates.
Well… That’s almost what’s happening. Corporations that do business in America (regardless of where they are headquartered) still owe US corporate taxes on profits made in America. Things get tricky, however, when American businesses make profits over seas. When these American companies try to repatriate that money (that has already been taxed by a foreign government) back home, they are charged nearly 35 percent by the American government… This has shockingly (sarcasm font) encouraged businesses to move their headquarters so they don’t have to repatriate profits to a tax hungry Internal Revenue Service.
As it turns out, businesses are actually designed to make profits. I understand this could be a difficult concept for government-centric liberals to wrap their brain around, but it’s a fact of life. The three
stooges legislators continued:
“Corporations that renounce their U.S. corporate citizenship should not be able to reap all the benefits that American tax dollars provide,” they wrote. “We urge you to use your authority to stand up for American companies which are proud to be part of our nation and reduce U.S. incentives for others corporations which would abandon their responsibilities to their country for a nod of approval from Wall Street.”
“A nod of approval from Wall Street”? Wow. That’s pretty rich coming from a bunch of wealthy lawmakers who invest their money in stocks. The truth is: America is a great place to do business. Unfortunately, the all-knowing “patriots”, who have helped craft a 74,000 page tax code, have managed to make doing business in America less profitable. And, not to belabor the point, but businesses are kinda built around profits.
Of course the tax-centric Democrats bemoan the prospect of an international “race to the bottom” in regards to corporate tax rates. “This is a race to the bottom the United States simply can’t win and should not be lured into entering,” they fretted in the letter… Not to spoil the fun, but maybe we should explain to these self-anointed arbiters of economic patriotism how corporations work.
See, corporations pay taxes with the money that they collect from consumers in exchange for a service or a product. In other words: The world’s highest corporate tax rate is paid by you and me. And if you don’t think the cost of government is calculated into the price of a good or service, then, I don’t think you’re smart enough to be my legislator.
You Dems want more companies to show a little economic patriotism, by bringing their global profits back home? Then stop penalizing it. Rather than begging King Obama to issue some economic decree, maybe we could focus on making America a bit more attractive for multi-national corporations… Or would that hurt your talking point?