There have recently been calls by politicians such as Bernie Sanders to raise corporate income taxes, and this is a very foolish proposition. He would like to see it raised to 35% https://www.cnbc.com/2019/10/14/bernie-sanders-would-raise-corporate-tax-rate-to-35percent-ban-stock-buybacks.html
Lies in the media have been spread about "corporate windfall profits", making these propositions seem great to those who don't truly understand how businesses operate in the context of the economy. The public perception of profits as of 2015 was that companies have a 36% profit margin. The reality is that, based on 212 industries combined, the average profit margin is 7.5% and the median profit margin is 6.5%. When you have these liberal politicians and media pundits constantly lying, this is exactly what you get: people believe corporate profits are 5x what they actually are, and then they support policy positions based off of this misinformation. https://www.aei.org/carpe-diem/the-public-thinks-the-average-company-makes-a-36-profit-margin-which-is-about-5x-too-high/
Additionally, consider exactly what happens when you tax a corporation, outside of the obvious effects of making America a less attractive country to start a business or invest in. How will these new taxes affect consumers? Corporations consider taxes to be just like any other item that costs them money- an expense. To adjust for these expenses, they will raise prices for their products. So, consumers end up paying the tax issued by the corporation. I will not pretend that this works in reverse as a sort of "trickle down economic" effect either. The only thing that will reduce prices for consumers is competition. You stimulate competition by eliminating barriers to entry and free up markets shackled by high taxes and expensive indirect costs such as regulation that small businesses and startups have difficulties complying with. They may not have the capital or lawyers necessary to make sense of thousands of federal, state, and local regulations.
Now, for anyone who disagrees, I would like to ask you: how do you believe a $15 federal minimum wage, more mandated family time off, more expensive regulatory compliance, and other such programs associated with the Democrat platform will make America a place that any foreign company wants to create jobs or a country in which our current companies will be able to remain globally competitive? Do you believe that this will have no effect on long-term economic growth, unemployment levels, or inflation caused by rising costs of products?
For anyone who doesn't want to raise corporate taxes, let me know anything I missed or if there are any misrepresentations of my position that I might have made.
Thanks to anyone who reads my mini-rant. Hope you have a nice day! :^)
