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  • National Priorities Project

    Interesting breakdown on how FY2009 tax dollars were allocated.


    Parting shoot on the report:

    "It's worth noting that in FY09, individual income tax payments contributed 6.6 times more than corporate taxes to federal revenues whereas thirty years ago, individual income taxes were 3.3 times greater than corporate contributions to federal revenues. In other words, in FY09, individuals contributed $915 billion to the $2.7 trillion total federal fund outlays whereas corporations only contributed $138 billion."

    This leaves $954 billion to be made up via other taxes. Regardless the single largest segment is the individual.

    Here's an interactive chart break down how your federal taxes were spent.

  • #2
    Re: National Priorities Project

    Businesses and corporations do not pay taxes. They never have paid taxes and they never will. The consumers that purchase their goods and services pay taxes. Any tax levied on a business or corporation it instantly added to the retail cost of the product or service in order to pay that so called tax. Taxing businesses is regressive and only punishes the consumer. Economics 101
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    • #3
      Re: National Priorities Project

      Originally posted by NHMaster3015 View Post
      Businesses and corporations do not pay taxes. They never have paid taxes and they never will. The consumers that purchase their goods and services pay taxes. Any tax levied on a business or corporation it instantly added to the retail cost of the product or service in order to pay that so called tax. Taxing businesses is regressive and only punishes the consumer. Economics 101
      Then I guess the corporations don't need access to the interstate highway system or bridges to transport their goods. And certainly corporations have no vested interest in a national defense system. And as for an educated workforce, not so much.

      So let the consumers that consume the corporations goods and services foot the bill for these taxes. After all, the US has one of the lowest corporate tax rates in the world. Switzerland, Canada, UK, France, Germany, Belgium, Norway... to name but a few, all have substantially higher corporate tax rates. I imagine that China doesn't have a corporate tax, but then that's one of the advantages of communism.

      Why should any of my tax dollars provide material assistance to a corporation?

      And lets be clear about this. When someone talks about cutting corporate taxes what they are really talking about is raising the individuals taxes or at the very least the debt that individuals will ultimately pay.
      Last edited by SpiffPeters; 04-06-2010, 07:46 PM.

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      • #4
        Re: National Priorities Project

        Spiff, You are not understanding which is normal because most people that are not in business don't. Whenever the fed or the state or the local government decides to raise my business taxes ( any of the many) I simply raise the cost of my products and services to cover that increase in taxes. The customer always foots the bill. The customer has always footed the bill, and the customer is you and everyone else. Businesses don't pay taxes plain and simple. Here's the real problem though. If you raise those taxes too much then the business can no longer compete with foreign competition and is forced to either close the doors or move operations to some country where their costs are less. Corporate taxation is one of the many reasons why manufacturing in this country has declined in the past 50 years.

        When you raise taxes on business (or rich people for that matter) all you are really doing is raising taxes on everyone.
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        • #5
          Re: National Priorities Project

          Originally posted by NHMaster3015 View Post
          Spiff, You are not understanding which is normal because most people that are not in business don't. Whenever the fed or the state or the local government decides to raise my business taxes ( any of the many) I simply raise the cost of my products and services to cover that increase in taxes. The customer always foots the bill. The customer has always footed the bill, and the customer is you and everyone else. Businesses don't pay taxes plain and simple. Here's the real problem though. If you raise those taxes too much then the business can no longer compete with foreign competition and is forced to either close the doors or move operations to some country where their costs are less. Corporate taxation is one of the many reasons why manufacturing in this country has declined in the past 50 years.

          When you raise taxes on business (or rich people for that matter) all you are really doing is raising taxes on everyone.
          Want to know what the worst part is? The initial model was for the manufacturing and businesses to soak those taxes, not the people themselves. This was based on the theory that the less the people were taxed, the more money the people will have to spend for those manufacturers products, or the businesses services, not the tax the people and lay off the companies.

          Also, when it comes to corporations not paying taxes. While this is true, the people that work for the corporation certainly pay their taxes, that includes the CEO and the rest of upper management, if you believe it.

          **Sidenote**
          A couple of years ago, the state of Massachusetts imposed a tax aimed at every pharmacy inside state lines. As stated above, the various companies that had their own pharmacies, like CVS and Walgreens, simply raised their prices for prescription medicine accordingly. Well, the state government blew the whistle and cried "FOUL!". The state representatives reminded those companies that the tax was aimed at THEM, NOT the people, and ordered the prices of those medications back to the original level prior to the tax, and not to factor in that tax at all for the cost to the consumer. Man did those companies SCREAM like stuck pigs! The swine-like squaling was heard clear accross the land.

          Now that I think of it, I wonder what ever happened in the end anyway.
          Last edited by tailgunner; 04-06-2010, 10:30 PM.

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          • #6
            Re: National Priorities Project

            When you raise taxes on business (or rich people for that matter) all you are really doing is raising taxes on everyone.
            So rich people should be exempt from paying taxes because they are rich and if they were taxed too much they might not like it. And since the whole purpose of a corporation is to let it interact within society like a person, that is, enter into contracts, buy things on credit, etc they should not be taxed either because they are essentially just rich people too.
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            • #7
              Re: National Priorities Project

              When corporate taxes are cut, the individual's taxes are raised. Do the corporations benefit from the various programs and institutions run by the federal government?

              When you raise taxes on corporations, you are lowering taxes on persons that do not do business with a given corporation.

              In thirty years the burden has steadily shifted to the individual, and what have we to show for it? We have an ever widening chasm between the financial elite and the rest of us.

              So corporation XYZ makes widgets. I don't own, need or want a widget. XYZ passes their tax onto their customer as an expense. And again, we have one of the lowest possible corporate income tax rates in the entire world, so the burden of the tax is minimal, relatively speaking.

              However, under your model, XYZ should not be burdened with a tax because they just pass it on to their customer, thus surrendering a competitive advantage to one of the five other countries in the world that have a lower corporate tax rate.

              Furthermore, under your model, even though I don't own, want or need a widget, my taxes are going to go up because XYZ should not be burdened with the sixth lowest corporate tax rate in the world.

              In essence, you are saying that the individual should subsidize the corporation as the corporation does not benefit in any measure from the services provided by tax dollars. They operate by and large outside of society.

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              • #8
                Re: National Priorities Project

                I did not make the model, it's just how business is done. If you owned the company, you would do the same thing. Do you really think that when taxes go up the company is really going to take the hit?
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                • #9
                  Re: National Priorities Project

                  Originally posted by NHMaster3015 View Post
                  I did not make the model, it's just how business is done. If you owned the company, you would do the same thing. Do you really think that when taxes go up the company is really going to take the hit?
                  It all depends on if the market will bear the higher prices. Maybe the services are in such demand, that even with the price increase business won't drop off. On the other hand, it might be that the prices are near an inflection point; and the owner would take a bigger paycut by increasing prices (and reducing volume) than by leaving prices alone and hopefully not reducing volume.

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                  • #10
                    Re: National Priorities Project

                    Originally posted by NHMaster3015 View Post
                    Do you really think that when taxes go up the company is really going to take the hit?
                    Of course not. It goes on the liability side of the ledger.

                    Why should my taxes go up so that any given corporation's taxes can go down or be eliminated all together?

                    Lets drop all corporate taxes. And then the corporations can build their own roads, highways and bridges. Provide their own sewer systems and water. Build their own mass transit system so their workers can get to work - or just build a compound to house their workers, and so on.

                    Any corporate tax cut is a tax raise on individuals.

                    CPW - Every community has a different take on corporate tax rates. The fleet service company that use to service my fleet told me once that the best move he ever made was incorporating his business. The tax deductions were amazing.

                    Perhaps its just a matter of sour grapes for me. As a wage earner I don't really have any tax deductions available. Sure I get some for my mortgage, but that's about it.
                    Last edited by SpiffPeters; 04-07-2010, 10:08 AM.

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                    • #11
                      Re: National Priorities Project

                      Originally posted by SpiffPeters View Post
                      CPW - Every community has a different take on corporate tax rates. The fleet service company that use to service my fleet told me once that the best move he ever made was incorporating his business. The tax deductions were amazing.

                      Perhaps its just a matter of sour grapes for me. As a wage earner I don't really have any tax deductions available. Sure I get some for my mortgage, but that's about it.
                      I don't mind businesses having deductions for true business expenses. Profit = Revenue - Expenses. What does irk me as a W2 employee is that often there will be "business" expenses that the person derives personal benefit from (e.g., the landscaper who drives his truck to the movies with his family, and deducts that gasoline).

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                      • #12
                        Re: National Priorities Project

                        Originally posted by cpw View Post
                        I don't mind businesses having deductions for true business expenses. Profit = Revenue - Expenses. What does irk me as a W2 employee is that often there will be "business" expenses that the person derives personal benefit from (e.g., the landscaper who drives his truck to the movies with his family, and deducts that gasoline).
                        And that was the point the fleet service owner was implying. He had significant economic advantages that were otherwise unavailable to me as a simple wage earner.

                        I understand the need to reduce tax liabilities. A business can be ravaged by taxes and fees to the point of disincentivising entrepreneurs. It is more than likely a business has to hire a CPA to take full advantage of the tax breaks available, but the service pays for itself in most instances.

                        For a lowly wage earner, there are few meaningful tax deductions available.

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                        • #13
                          Re: National Priorities Project

                          Originally posted by cpw View Post
                          I don't mind businesses having deductions for true business expenses. Profit = Revenue - Expenses. What does irk me as a W2 employee is that often there will be "business" expenses that the person derives personal benefit from (e.g., the landscaper who drives his truck to the movies with his family, and deducts that gasoline).
                          IF you share a vehicle for personal and business use, you are required by IRS code to maintain a log of your actual miles driven for business purposes and scale all vehicle expenses accordingly. Yes, this is a pain but many small business owners do this. Should you get audited and you don't have the log, the deduction will be disallowed, and iif it's a fair amount of money the IRS will go back to past years and disallow those, too... charging you interest on what you owed from the day you owed it. Once nailed, most folks that share the vehicle for personal use will start carrying the log in their glove box.

                          If you decide to falsify the log, better work hard at it... the IRS knows to correlate your vehicle expenses (for which receipts are required) against mileage. Pretty hard to fool them in an audit.

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                          • #14
                            Re: National Priorities Project

                            Originally posted by SpiffPeters View Post
                            And that was the point the fleet service owner was implying. He had significant economic advantages that were otherwise unavailable to me as a simple wage earner.
                            It's entertaining to read this discussion about how business owners are getting all these "advantages".

                            Making money in business is the toughest thing I have ever done. W2 employees for the most part have a real misconception about what it is like. Yes, there are some tax advantages, but they are not overwhelming nor are they unreasonable in light of a Government that requires a business to expend huge sums for regulatory compliance, benefits, payroll taxes, worker's compensation, etc. Folks should study the IRS code, or even just take a look at Form 1040 Schedule C before you conclude that businesses are somehow getting all kinds of unreasonable benefits. In the big picture, they're not.

                            Plus, undertand that there is a difference between a "business" and a "corporation". For most forms of corporations (some exceptions for small businesses), profits are double-taxed. The corporation pays at the corporate rate and then any dividends paid to the owners (stockholders) are taxed again. It's the same money, no value add going on, it's just hit twice.

                            The argument that individual taxes go up if corporate taxes are reduced is flawed. Whether you personally buy from a given corporation or not is immaterial... you DO spend money on goods and services from corporations. So in the end there is a a large amount of public spending flowing to a large pool of corporations, paying tax on their profits. You can't take the microeconomic view and say that since you don't buy from XYZ Corp then you are somehow subsidizing them. You spend your money at Acme instead of XYZ, so at the macroeconomic level, it's a wash. Unless you don't spend your money with corporations at all... which is an unrealistic condition.

                            NHM has a very legitimate point. No matter how you slice it, in the end all money that goes into a corporation comes from the consuming public's wallet. There's a major exception, to be mentioned later. After-tax profits are either paid out as dividends (to be taxed again) or plowed back into the business to fuel expansion, growth, R&D, etc. If corporate taxes increase, all corporations feel it and must either increase their margins or live with lower profits. Pices go up on EVERTHING, for EVERYONE. If a corporation has to live with lower profits (there are reasons they may have to do this - for example, competition from foreign imports that don't pay US corporate taxes) then dividends go down, effectively transferring the tax increase burden to the shareholders. A negative economic stimulus. The other impact of higher corporate taxes is that less money is available to go back into the business -- meaning they don't buy as much new equipment, don't modernize or expand their facility, don't hire as many new people, cut back on R&D, etc. Does any of this sound good to anyone?

                            One source of income to a corporation that doesn't come from the public is interest and dividends that they make by investing their cash - derived from profits. They pay taxes on this and again when it's distributed to the shareholders as part of the divident - it's taxed again.

                            Certainly there are corporations that enjoy certain advantages. The oil companies come to mind. I would like to see some serious steps to bring them in line, based largely on the fact that they operate in anything but a free market. But for the vast majority of businesses, it's is absolutely ridiculous to generalize and vilify corporations over, of all things, taxes. Just another great example of how many Americans are always looking for "someone else" to pay for the entitlements and other freebies that they want.

                            Well, in the end, there is no "someone else". We The People pay for everything, and all this nonsense is really the greatest Ponzi scheme of all.

                            Social programs - entitlements - such as Social Security and Medicare currently represent the largest outlay of the Federal Government. The National Priorities site doesn't make this clear, not because they are lying but because of the way they have bucketized the expenses AND the way the Federal Government chooses to account for Social Security outlays.

                            Social programs are not a feature of the Constitution. They were added over many years as liberals ignore the realities of economics and encourge the public that they can "have it all" and that the mysterious "someone else" will be forced to pay for it. The result of creeping socialism over the past century has been that, like every other socialist-republic, we have become economically stuck in the mud.

                            The sad thing is that this isn't new. It's been recognized (well, not by the liberals) for many, many years. The incorporation of the Grandaddy of Entitlements - Social Security - met with great resistance by those that knew better. Guess they were right. Read your Social Security statement. They're guesstimating that your bennies - the amounts listed - are going to be paid out at something like 70% of those amounts - or less. Not to mention that with the near-inevitabliity of inflation in the future, the result is that this program is well down the road to helping dismantle the economy as it prepares to offer essentially peanuts in benefits.

                            Good job, liberals! Maybe you should get Obamalosi to subsize the carboard boxes we're all gonna be living in.

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                            • #15
                              Re: National Priorities Project

                              I can't argue this anymore. One of two things happens when you either increase business taxes or come up with a new business tax. Business either ups the cost of goods and services to cover the tax or it goes out of business because it can no longer operate at a reasonable profit. Roads, services and all that stuff don't matter.

                              Businesses do not pay taxes I don't know how to explain the concept any clearer. Politicians love to levy business taxes because most people are too dense to realize that it is them that pay the price while the politician looks like he's putting it to the big evil corporation. People are so gullible.
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