All You Ever Wanted To Know About Corporate Taxes

Articles

Brooks A. Mick

All You Ever Wanted To Know About Corporate Taxes
June 8, 2003

I’ll cut to the chase: THERE IS NO SUCH THING AS A TAX ON CORPORATIONS!

I know, you hear about the government taxing the big corporations all the time. Politicians love to say such things, for it makes you think you are getting a break. After all, they are taxing evil big business. The big corporation, General Motors for example, or Microsoft, is being taxed so you, the little guy, doesn’t get taxed as much. That’s what the politicians want you to believe.

And that’s what you think, isn’t it? Don’t you feel good when you hear that some big corporation is being taxed? Well, sorry to disillusion you, but it isn’t the corporation paying the tax. People pay taxes, not corporations. Corporations are just fictitious entities which transact business deals. But they don’t pay taxes. I’ll explain.

The government levies a 20% tax, let’s say, on the profits of ATT. So ATT sends a check for a few hundred million bucks to Uncle Sam. But where does ATT get that money?

1) They pay workers less than they could otherwise afford.

2) They pay lower dividends to their stockholders than they otherwise could.

3) They charge customers more than they otherwise would to make a reasonable profit.

So who’s paying the “corporate tax?” Workers, stockholders, and customers! It isn’t the corporation which is paying the tax. The corporation is just the stealth tax collector for the government, which gets to pretend that it isn’t taxing the average citizen. And you’ve been falling for that scam, haven’t you?

But chances are your pension fund has some ATT stock in it, and your dividends are less because of the sham “corporate tax,” and so there’s less money for you when you retire. And your mom’s and grandpa’s pension, too! And you may be an ATT customer, and if so, you are paying your share of that “corporate tax” in your phone bill. And, of course, if you work for ATT, your paycheck is a little smaller because you are paying that “corporate tax.” And other corporations which use ATT service pay more, so their profit is less. It is a compounding, snowballing effect.

So never, ever cheer when you hear the government is taxing someone else, even if it is some gigantic evil corporation. Because, whether you know it or not, it is costing YOU!

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Email Brooks A. Mick: brooks15@cox.net

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