Corporate income taxes

In my unsuccessful first congressional run against Phil Gingrey, a cornerstone of my message was to lower or eliminate the corporate income tax so that foreign businesses would come here and that the United States becomes the tax haven.

My wife is a CPA. Her career is spent working on multinational corporate taxes. Based on her comments and my research, I found that corporate income tax laws are a massive mess, a national disgrace. At her company, a team of fifty CPAs work full time auditing her company. That’s fifty people from one of the big four accounting firms, probably costing her company over $60 million a year just to keep the IRS off its back! What a waste of money, talent and resources.

Corporate income tax laws are full of loopholes, special provisions for generous political contributors, variable tax rates, and on and on, so much so that an entire industry is in place to deal with them.

The tax laws are so bad that they distort the use of capital so that huge amounts of corporate money is spent to avoid taxes, and not to create income and jobs… and only raises a tiny amount of our government’s revenue.

At this time, corporations only pay 1% of our GDP, or $181 billion in tax. If we reduced the corporate tax rate to zero, foreign companies would flood here providing hundreds of thousands of jobs for U.S. citizens.

We’d become the world’s largest tax haven, plus our domestic corporations will also bring home over $1 trillion of cash being held overseas. They won’t bring it back, as it will be taxed.

Zero tax rates for corporations are good for jobs.

So why are there so many loopholes? The simple answer is politics. When an incumbent does a favor for a monied corporation, reelection money flows to that incumbent when the next election is held. If you think that good ideas are what gets a challenger elected, then you’re wrong. Its money, lot’s of it.

Being an incumbent is all about self-interest, not public interest. The solution to that is to force incumbents to give all of their left over contributions to charity after each election, not hoard it as they do… even after they retire!

The only downsides are that the entire U.S. corporation tax accounting industry would be out of work, and small countries that are tax havens won’t be any more. The money would flood here instead. Good for us, bad for them.

I’m not worried; the CPAs and tax-haven countries will find other productive sources of revenue to support their citizens.

So if you want to create jobs, jobs jobs, support zero corporate income taxes.