Inverted Logic

22 09 2014

Toronto

PJB’s latest tries to bring a little bit of reason to this Democrat manufactured election year hoopla over corporate inversions, manufactured by the same people who helped bring you NAFTA and GATT.

Really, it’s not that complicated.  Let me walk you through it.

An American-based corporation is subject to the higher than world average corporate income tax rates on the gross income that it generates from its American business.  It’s also subject to both the American corporate income tax rate and the relevant country’s corporate income tax rate on its business done outside the USA.

For our Yankee government to try to tax business that takes place outside the USA is like you setting the kids’ bedtimes for your neighbor’s household.

So to avoid this arrogant double taxation, firms are engaging in a tactic known as inversion.  Large American firm buys smaller foreign firm, and the headquarters of the new combined firm is wherever outside the USA this smaller firm was based before the buyout.  It now means that Uncle Sam can’t touch this firm’s outside-the-USA business income with the relatively high American corporate tax rates.  It does NOT mean that the new firm’s American operations aren’t subject to those American tax rates, because they are.

Take for example the Burger King inversion.  Before then inversion, BK’s American income was subject to American tax rates, but its non-American income in, e.g. the UK, was subject to both USA and UK corporate taxes, repeat for every other country where there are Burger Kings.  What happened in the inversion is that Miami-based Burger King purchased Toronto-based Tim Horton’s, and the new combined Burger King Tim Horton’s (BKTH) will be based in Toronto.  Which means that BKTH operations in the USA are subject to USA taxes, (and as you know, Tim Horton’s is going to open up a slew of stores in America, including one I told you about yesterday, the first one in St. Louis will be in Maplewood), but BKTH operations outside the USA are only subject to the relevant country’s tax rates and not also the American tax rate.

Therefore, this talk about possibly “repatriating” profits is a misnomer, because the profits were on income generated outside the USA all along.  To the extent that they could be theoretically “repatriated,” its only in the sense that the arrogant Yankee government thinks that all income in all countries of American-based firms is subject to American tax rates.

So what’s the solution?  Ideally, the Yankee government should quit thinking it owns the whole world.  Short of that, the best solution is an international convention harmonizing corporate income tax rates, especially the top marginal rate.

The one big difference, though, is that businesses are taxed not on every dollar of cash they take in as revenue, as individuals are, but they are only taxed on their gross income, that is, revenue minus expenses, though not every item of business spending is a legally defined business expense according to the IRS.

 





Economic Man

6 08 2014

Amurrika

This sounded good, until I got to the details.

The pesky detail is that Alter thinks that “loyalty to America” means nothing more than paying taxes to the Leviathan based in Washington, D.C.   Which means that the modern left’s version of “nationalism” is nothing more than the same kind of economism and bean-counting that cosmo-conservatives and cosmo-libertarians have given us for a very long time.

Pat Buchanan once leveled the same sort of criticism at the same kind of people, only PJB thinks of nationalism in more proper terms, blood and soil nationalism, or pretty close to it.

If it were up to me, every CEO of every larger publicly traded corporation in the country would recite a pledge of allegiance to the white race every morning before the start of business.





“You Mean I Actually Have to Pay All the Taxes I Voted For?”

4 06 2014

Austin

You got it, dear.

This is right up there with “those filthy rednecks down South in trailer parks.”





Tax Act

5 05 2014

Jefferson City

The “severe” tax cut bill that Jay Nixon vetoed today?

It would have cut the top income tax rate down from 6% to 5.5% starting in 2017.  Remember that that rate starts at $9,000 a year, so that would have applied to a lot of people.

There’s another thing.  Missouri’s income tax brackets, which were in six increments a thousand bucks apiece and a percent apiece starting at $1,000 a year and topping off at $6,000 a year, (until it was changed a few years ago to have nine brackets of a thousand apiece and a half percent apiece topping out at $9,000 a year), were implemented when Missouri first started its income tax, when $1,000 a year of income wasn’t just chump change.  What I wish they’d do before anything else is gradually widen out the brackets to reflect for the dollar inflation that has happened since 1931.  If, for example, we indexed the brackets to inflation back in 1931, and still had six brackets, the brackets today would be $15,000 apiece, meaning that 6% wouldn’t start until $90,000.

Or just cut the crap and make 6% the flat rate.

UPDATE

Usually, attempts to override the Governor’s veto on major legislation is usually held back until the September special session.  But the Senate late yesterday and the House just a short time ago today have already overridden the veto.  I was hearing yesterday that the legislature would move quickly on an override, but I thought that was more bluster than reality.





Rock Check, You Lose

15 04 2014

Washington, D.C.

Who’s the snarky blogmeister who’s been saying that governments are going to get so hard up financially that they’re simply going to refuse to mail out tax refund checks, and therefore the thing to do is engineer your withholding so that you slightly owe rather than get a big refund?

Turns out I was slightly wrong.  It’s not that they’re willy nilly refusing to mail out the checks, they’re passing and latching onto flimsy laws and flimsy legal excuses to requisition refund checks.





Reading Material

17 09 2013

Utah

A tax reform plan that heavily benefits married couples with children. Reading between the lines, white working and middle class families would disproportionately benefit, with the biggest benefit going to high TFR demographics, like, say, Mormons.

Gee, you don’t think Mike Lee is a Steve Sailer reader, do you? You don’t think someone in the Republican Party is finally taking the hint and looking into this whole affordable family formation thing, do you?





No Mo Money

24 07 2013

Memphis

momoney

You just knew there was at least one Federal felony hiding in there somewhere.

Yeah, like I would really trust a firm with an Ebonics name with my personal financial well being.

Now it’s time for some YT fun.








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