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RE: The Ethics Of Corporate Tax Avoidance

in #tax6 years ago

Mass layoffs and corporate inversions are a result of extreme corporate tax rates. Assume 50% tax rate for simplicity. If you invest $100 and double that, you stand to make $50 after taxes. If your business fails, you stand to lose $100. It's not very strange that the tax rate might encourage inversion. And as the tax policies outside of USA continues to improve, the incentive for inversions will grow. And we can empirically see that it is capital, if allowed to accumulate, that raise the living standards, from the richest capitalist to the poorest laborer, simply because capital pays wages. It's therefore in everyone's interest, but especially the unemployed, that the businessmen are allowed to accumulate as much capital as possible. Capital of course also increases productivity. The higher productivity that has its origin in a more extensive use of capital leads to more goods becoming available at lower and lower prices. This will benefit all obviously, but especially all the poorest members of society. More capital thus increase the real wages. Yet, the majority of these people will probably vote for socialism even higher tax rates = lower wages and less jobs.

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