A Lesson in Stupid Tax Policy

American Thinker | by Daniel Salvaterra | July 12, 2009

North Carolina is a state with a huge budget deficit. It is one of the worst state deficits in the nation at $4.6 billion or 21% of the general fund budget for fiscal year 2010. In addition, North Carolina has the 5th worst unemployment rate in the country at 11.1%, and just missed the top 10 lists of the worst states in the country for business.

So how has the Tar Heel State proposed it solve its budget crisis and spur economic growth? Not by cutting spending of course! Governor Beverly Perdue has proposed $1.5 billion in tax increases, much of which will come from taxing online retail sales from companies that have no physical presence in the state. [Read more…]

US Companies Pay the Highest Taxes in the World

US High Taxes Corporations Businesses It may come as a surprise that US companies pay the highest taxes in the world. Yes, you read that right! American businesses, large and small and across all industries pay from 35% to 41.6% of their income in combined state and federal taxes. The 41.6% maximum rate is scheduled to rise to 46.2% in 2010 when President Obama’s promised tax increases are implemented. Compare that to socialist France where companies pay only 34.4% in taxes, to China where the rate is 25%, or Russia which levies a mere 24%. Corporations in Ireland, Europe’s fastest growing economy for the last 18 years, pay just 12.5% in taxes.

Because of its dual taxation system, US businesses and individuals are required to pay both state and federal taxes on their income. When combined both these taxes range from a minimum of 35% in states like Nevada, South Dakota, and Wyoming that do not tax business income, to a maximum of 41.6% in Iowa, the state with the highest corporate tax rate of 12%. [Read more…]

The 2 Percent Illusion

Wall Street Journal | Feb. 26, 2009

Take everything they earn, and it still won’t be enough.

President Obama has laid out the most ambitious and expensive domestic agenda since LBJ, and now all he has to do is figure out how to pay for it. On Tuesday, he left the impression that we need merely end “tax breaks for the wealthiest 2% of Americans,” and he promised that households earning less than $250,000 won’t see their taxes increased by “one single dime.”

This is going to be some trick. Even the most basic inspection of the IRS income tax statistics shows that raising taxes on the salaries, dividends and capital gains of those making more than $250,000 can’t possibly raise enough revenue to fund Mr. Obama’s new spending ambitions. [Read more…]

Fool’s Golden State

Investor’s Business Daily | February 19, 2009

The world’s leading maker of microprocessors plans to create 7,000 jobs in new and expanded plants that will churn out computer chips 30% more powerful than the current generation of chips. But California-based Intel won’t make them in California.

Instead, the company is expanding in Oregon, Arizona and New Mexico. Anywhere but California, which is now so unfriendly to business, even its home-grown firms don’t want to expand there.

This is bad news for the Golden State, which has one of the worst business environments in the country. And it won’t be helped a bit by the recent budget deal reached between Gov. Arnold Schwarzenegger and the Democrat-led legislature. [Read more…]

The Decline of California

The Wall Street Journal | February 17, 2009

If you thought Washington’s stimulus debate was depressing, take a look at the long-running budget spectacle in California. The Golden State’s deficit has reached $42 billion, Governor Arnold Schwarzenegger is threatening to furlough 20,000 state workers (go ahead, make our day), and as we went to press yesterday Democrats who control the legislature had blocked lawmakers from leaving until they finally get a deal. [Read more…]

A Primer on Capitalism

Capitalism Freedom Private PropertyIn today’s turbulent financial times and difficult economic conditions, a lot of unjustified criticism and unwarranted accusations have been laid at the doorstep of capitalism. Many in the mainstream press and academia, a majority of politicians, and a large number of Americans have jumped on the bandwagon and unfairly blame capitalistic principles for the huge mess that we are in. Such widespread confusion evidences a misunderstanding by many Americans of how value is actually created in society and what capitalism really represents.

All societies, in order to prosper, grow, and take care of its citizens must create new value to sustain its economy and support an expanding population. Common sense and experience dictate that there are only three (3) possible ways for anyone in life to have, create, or obtain value (monetary or economic) or acquire any assets (property) to be able to live or sustain oneself or one’s family: [Read more…]

US Corporate Tax Rates vs. World’s Largest Economies

Comparing US Corporate Tax Rates to the World’s Largest Economies (2008)
The United States is the world’s largest economy. When compared to the next 14 countries that represent the world’s largest economies (number 2 through 15) by gross domestic product (GDP) as of 2008, here’s how the US stacks up. (Wikipedia & CIA World Factbook) [Read more…]

US States Lead the World in High Corporate Tax Rates

TaxFoundation.org | Scott A. Hodge | Mar. 18, 2008

In March 2008, the Tax Foundation released a summary of the tax rates that US corporations pay. The results are truly eye-opening.

Many states impose state corporate income taxes at rates above the national average of 6.6 percent. Iowa, for example, imposes the highest corporate tax rate of 12 percent, followed by Pennsylvania’s 9.99 percent rate and Minnesota’s 9.8 percent rate. When added to the federal rate, these states tax their businesses at rates far in excess of all other OECD countries.

When compared to other OECD countries:

  • 24 U.S. states have a combined corporate tax rate higher than top-ranked Japan.
  • 32 states have a combined corporate tax rate higher than third-ranked Germany.
  • 46 states have a combined corporate tax rate higher than fourth-ranked Canada.
  • All 50 states have a combined corporate tax rate higher than fifth-ranked France.

[Read more…]