America must reform corporate tax system
Recently, Delaware North, a well-established Buffalo-based business, has requested tax breaks for its move of company headquarters. Here’s a solution to this dilemma that may work out for our entire country.
Let’s replace the current federal tax system for businesses, which taxes only profits of businesses located in the United States, with a graduated sales tax on all sales in the United States, including sales of companies based off shore. This tax would not be collected from consumers at time of sale, but quarterly, directly from those businesses. The largest corporations would pay the highest (but still small) percentage, while mom-and-pop businesses would pay the lowest percentage.
There would be only two deductions allowed from this tax levy. First, any state or local taxes would be deducted. This would serve to “level the playing field” so that high-tax states could better compete with low-tax states. Second, a tax credit for each employee living in the United States would be given. This would encourage companies to do more manufacturing in the United States and also to hire more American employees. It would also tax huge corporations that currently pay no tax (Exxon Mobil, etc.) at a fair rate.
Lastly, it would put a stop to well-established companies attempting to extract tax breaks from their local governments because any such tax breaks would be offset by a higher federal tax bill. It’s high time that Congress addressed the tax fairness issue, and the corporate tax system is more greatly in need of reform than the personal income tax system.