I remember. That was when the top tax rate was never below 70%, and was often much higher.

 

Executive Summary
The tax overhaul signed into law by former President Donald Trump in 2017 cut the federal corporate income tax rate from 35 percent to 21 percent, but during the first five years it has been in effect, most profitable corporations paid considerably less than that. This is mainly due to loopholes and special breaks that the 2017 tax law left in place and, in some cases, introduced. Corporate tax avoidance occurs because Congress allows it to occur, and the Trump tax law in many ways made it worse. The corporate minimum tax and expanded tax enforcement funding signed into law in 2022 by President Biden could begin to reduce corporate tax avoidance, as would other proposals from the White House that have not yet become law.

This study examines federal corporate income taxes paid by the largest profitable corporations from 2018 through 2022. Because the corporations included in this study were profitable each year for all five of those years, one would reasonably expect that they would pay significant taxes. But in many cases, they did not.

• The 342 companies included in this study paid an average effective income tax rate of just 14.1 percent during this five-year period, almost a third less than the statutory rate of 21 percent.
• Nearly a quarter of the corporations in this study (87 companies) paid effective tax rates in the single digits or less during this five-year period.
• Of these, 55 (16 percent of the total 342 companies) paid effective rates of less than 5 percent. This is particularly striking given that all these companies were profitable for at least five years consecutively. Companies paying less than 5 percent include T-Mobile, DISH Network, Netflix, General Motors, AT&T, Bank of America, Citigroup, FedEx, Molson Coors, Nike, and many others.
• Twenty-three corporations paid zero federal tax over the five-year period despite being profitable in every single year. And 109 corporations paid zero federal tax in at least one of the five years.
• At the other end of the spectrum, 50 corporations paid effective tax rates of more than 21 percent, but most of these companies were also the beneficiaries of large tax breaks because they were paying taxes from previous years that they delayed using depreciation breaks.

The low effective corporate tax rates found in this study demonstrate the need for substantial tax reform, of which the new corporate minimum tax that was signed into law by President Biden is a welcome first step. Of proposals currently being advanced, an even more important additional step would be the global minimum tax negotiated by the Biden administration but currently blocked by Congress.

 

The Latest Convoluted Arguments in Favor of Rich People Not Paying Taxes
November 13, 2023

Two Senate hearings last week focused on how the richest Americans are avoiding and evading taxes in ways that ordinary Americans could hardly imagine.

All the experts brought in to testify seemed to agree that the House GOP’s recent tactic of “paying for” a spending proposal by cutting IRS funding makes no sense because it reduces revenue collections and increases the deficit.

They also seemed to agree that a lot of the problems with well-off people avoiding and evading taxes stem from our tax code’s complexity.

And yet, the witnesses called by the Republicans nonetheless produced convoluted arguments against President Biden’s policies to address these very problems.

The debate over IRS funding is a case in point. The Inflation Reduction Act provided $80 billion in increased funding to the IRS over 10 years, and $46 billion of that was for enforcement (meaning increased audits, among other things). The President has stated that this additional enforcement will be directed to those with income of more than $400,000. This would produce $180 billion in new revenue over this time, the Congressional Budget Office estimated, suggesting a return on enforcement funding of roughly 4 to 1.

MIT professor Nathaniel Hendren testified before the Senate Budget Committee that the revenue impacts are much greater than this, partly because CBO is reluctant to estimate the indirect effects of increased enforcement. (Indirect effects include, for example, fewer taxpayers even attempting to evade taxes because they know they may be audited.) His research focused specifically on the high-income people who would be subject to the increased enforcement and found that the return would be 12 to 1.

The Cato Institute’s Chris Edwards agreed with other witnesses that cutting IRS funding does not “pay for” anything and that it actually increases the deficit, contrary to what House Republicans claim. Yet Edwards still provided convoluted arguments against the IRS funding provided in the Inflation Reduction Act.

“Enforcement is a blunt tool,” Edwards said—a startling statement to anyone who believes that Congress enacts laws with the expectation they will be enforced. Edwards pointed out that the IRS wins litigation against taxpayers about half the time and that in recent years it only collected about 48 percent of the dollars in dispute. Given this, he argued, increased enforcement is not optimal and other steps could increase tax compliance.

There are many problems with this argument. First, Congressional Republicans are not offering any other proposals to increase tax compliance, they are simply trying to gut the IRS (much as they did in the 2010s). Second, the dollars collected in IRS enforcement efforts are an obvious return on these efforts but a less visible return, which Edwards ignores, is all the tax evasion that taxpayers are not even attempting because it is not worth the risk given the current chances of facing an audit. Third, nothing he says suggests that the enforcement efforts bring in less than they cost.

Also, Natasha Sarin, a former Treasury official, testified that the IRS has until now been ill-equipped to take on some of the large, vastly complex business structures that are often used to hide income. As she explained in her written statement:

“As one example, the IRS’s most recent detailed study of pass-through evasion was conducted in the 1980s. In the intervening four decades, these structures have grown in importance: For example, partnership income as a share of business income grew from less than 5% to more than 35% today. But the IRS has not had resources to devote to measuring partnership evasion, let alone thinking about how best to address it, and indeed, today the agency’s partnership audit rate is approximately 0%.”

She pointed out that a web of business entities could involve partnerships owned by other partnerships that are owned by foreign entities that are owned by other domestic entities, in a long chain that must be disentangled, usually by a single IRS agent assigned to examine it. The increased IRS funding can make it possible for the agency to hire more of the highly skilled experts needed to get to the bottom of these structures.

A hearing of the Senate Finance Committee the following day focused more on tax avoidance – tactics that are legal, or at least arguably legal, to reduce one’s taxes. This involves individuals and corporations using the special breaks enacted by Congress and other loopholes to pay as little as possible.

Witnesses, including William McBride of the Tax Foundation and Douglas Holtz-Eakin of American Action Forum, seemed to agree that the type of complicated transactions and schemes used by the wealthy to avoid taxes are the result of complexities in the tax code. Chris Edwards of the Cato Institute said the same thing the day before in the Budget Committee hearing.

And yet it is strange to hear this from supporters of 2017’s Tax Cuts and Jobs Act, which introduced brand new byzantine provisions that arbitrarily favor certain types of income over others. This is a perfect recipe for encouraging taxpayers to contort their affairs to fit within the rules of particular tax breaks. One example is the law’s 20 percent deduction for certain pass-throughbusiness owners. Another example is the provisions allowing corporations to pay far less on profits they book offshore, which have clearly allowed offshore tax dodging by corporations to flourish.

Upon passage of the law, a group of lawyers wrote a long article titled “The Games They Will Play” about how these and other provisions could be exploited relentlessly. How anyone could support this law and then decry complexity in the tax code is mindboggling.

While there was little consensus on solutions among the witnesses or the lawmakers, no one watching these hearings can miss the fact that well-off people seem to live under a completely different tax code than the rest of us.

Chye-Ching Huang of the NYU Tax Law Center explained how very well-off people have many opaque ways of generating income and structuring business transactions, thanks to complicated tax provisions that allegedly “promote growth” and the highly paid attorneys and accountants who can assist them. This all provides ample opportunity for tax evasion and tax avoidance. Meanwhile, the typical middle-class American receives their income from working at a job where an employer reports their earnings to the IRS, leaving few if any opportunities to evade or avoid taxes.

She also explained that many tax breaks for income from wealth are provisions that create the kind of complexity that can be gamed to avoid taxes. For example, taxes on capital gains can be deferred for years until a taxpayer sells an asset, even then the income generated is often taxed at a lower rate, and sometimes the income escapes taxation forever because an asset is left to heirs and the gains on the asset are erased from the tax system.

All this in turn creates more complexity because it encourages individuals to leap through hoops to recharacterize their income as the type that is eligible for these breaks. One of the most famous examples is the carried interest loophole, by which fund managers can characterize the compensation they receive for work (for managing other people’s money) as capital gains so that they can defer tax and enjoy the lower tax rate.

Sharply limiting these tax breaks as President Biden has proposed is a straightforward solution to this. But that is apparently not the “simplification” that Republican members of these committees or the witnesses they called favor.

 

We cannot tax our way out of debt.
We cannot tax our way out of debt.
We cannot tax our way out of debt.
We cannot tax our way out of debt.

 

The debt ceiling was raised 17 times, yep 17 times for Reagan.

The fiscal conservative, eh

 

I have already proved this to be false.

 

No you haven't.
You posted a lot of picked "facts" but you haven't explained how giving the robbers in Congress and the administration more money will reduce the debt.
What we can count on them to do is tax and spend. They have all proven that they will not pay down the debt unless they get a cut of the action.

Until government is cut by 25%, there are mandatory balanced budgets and congress starts taking care of our business the debt will continue to grow.

Until it consumes us.

 

Did you know that we have a govt program that identifies govt waste that could save us trillions....? Unfortunately, it appears that this program is a waste too because presidents aren't using it.

Here is the link if you would like to see the items the have identified https://www.gao.gov/high-risk-list

A quick insight:

Which government programs are considered wasteful or inefficient?
As of March 2023, 38 federal programs were classified as high risk, meaning they pose a threat to public health, national security, economic growth, or citizens' rights, among other concerns.

Updated on Mon, April 10, 2023 by the USAFacts Team

Which government programs are considered wasteful or inefficient?
The Government Accountability Office (GAO) is an independent agency responsible for providing unbiased, fact-based information to save taxpayers money and run the government more efficiently.

Since 1990, the GAO has produced a high risk list identifying government programs it considers vulnerable to waste, fraud, abuse, mismanagement, and in need of reform.

These programs manage substantial public resources and provide critical services, and can affect public service.

Which government programs are vulnerable to waste, fraud, abuse, or mismanagement?
As of March 2023, the high risk list identified 38 government programs requiring reform. These programs address issues ranging from managing federal property to national cybersecurity, rising drug abuse or other pressing issues.

Take the US unemployment insurance system. It lost over $60 billion in fraudulent payments during the COVID-19 pandemic. The GAO added it, rather than the Labor Department which heads the program, to the high risk list in 2022.

Government responsibilities such as enforcing tax laws through the Internal Revenue Service, protecting the cybersecurity of the nation, and administering Medicare are all currently on the list.

According to the GAO, these programs have been wasting government resources in some shape or form for decades without correction.



The Department of Defense has several programs on the list, indicating excessive spending, inefficient management, and vulnerability to waste, fraud, and abuse.

Take the example of the Department of Defense's contract management program. This program oversees agreements between the government and private companies or civilians to provide essential military supplies and services.

Despite being on the list since 1992 and experiencing multiple instances of fraud, the program spent more than $400 billion on contracts in 2020, accounting for over 60% of the Defense Department's budget.

 

Agreed! Giving more money to the government (especially the federal government) is like giving more heroin to a junkie. Spending needs to get reasonable, that's the only solution; but there's no sign that that's happening, or that they're even thinking about it.

And it's not a Democrat or Republican thing; it's all of them. Congress is not doing its job.

 

Its a start.
The fraud so prevalent with unemployment has a simple solution. States would need to send a text or e mail to claimants notifying them that a claim had been filed.
If it was a fraudulent claim the real employee could respond and the claim process would be halted before any check was cut.

 

He thinks he's stumbler!

 

Uh oh.
The unrequited bromance is causing a break with reality.

Should we intervene?
Or stand back and wait for the entertainment to start?

 

I say stand back and wait.

 

So shooter, do you know how many times the debt ceiling was raised for repuke presidents?

Any ideas?

Huh

 

Dismissed

 

Biden's tax-hike plan would cost the US economy nearly 800K jobs

President Biden has pitched an array of tax hikes targeting corporations and wealthy Americans, but the steeper levies could weigh on the already-fragile U.S. economy, according to the Tax Foundation.

Findings from the Tax Foundation, a group that advocates for lower taxes, found the higher taxes laid out in Biden’s sweeping budget blueprint for federal spending in fiscal 2025 would reduce economic output by 2.2% in the long run, slash wages by 1.6% and kill about 788,000 full-time equivalent jobs.

The policies outlined in the plan would “make the tax code more complicated, unstable, and anti-growth, while also expanding the amount of spending in the tax code for a variety of policy goals not related to revenue collection,” the report said.

As part of the proposal, Biden called for a 25% minimum tax rate on households worth more than $100 million, raising the capital-gains tax rate, quadrupling the corporate stock buyback tax to 4%, raising the corporate tax rate to 28%, increasing the Medicare tax paid by wealthy Americans, implementing a global minimum tax on multinational corporations and closing the carried interest loophole used by private equity and hedge fund managers.

Altogether, the tax increases would reduce the federal deficit by about $3 trillion. Money from the newly generated revenue would also help to pay for expensive new programs floated by the president, including a monthly tax credit to help some homeowners offset steep mortgage payments, subsidies for child care and lower prescription drugs.

In the case of the capital gains tax, the proposed changes would “push the United States beyond international norms,” according to the Tax Foundation.

 

I do literally laugh at your stupid ignorance (two different things) and your feeble attempts to bully reality. The "president" has very little to do with that list. It is and always has been a list of congressional pet projects. It is Congress that is responsible for spending money. President Biden could tell Congress right now to eliminate everything on that list and Congress would tell him to get fucked.

 

U.S. economy performs far better under Democrats than Republicans: study

Thor Benson, Common Dreams
April 3, 2024 7:14AM ET




President Joe Biden (Brendan Smialowski AFP/File)




A study published by the Economic Policy Institute on Tuesday finds that the U.S. economy does better when a Democrat is in the White House than when a Republican is in charge.

The study looked at GDP growth, job growth, inflation-adjusted wage growth, the unemployment rate, and more. It found that Democrats have had an economic advantage since at least 1949.

"This Democratic advantage is across the board in all variables we measure but strongest in private-sector outcomes—notably, business investment, job growth, and the growth of market-based incomes," it says.

https://www.rawstory.com/u-s-economy-performs-far-better-under-democrats-than-republicans-study/