With local land taxes skyrocketing, today’s NY Times article about corporate pass-through tax restructuring raised my blood pressure. But then I thought, heck, just make me a multi-national corporation and, like Apple, I can avoid paying my fair share.
From today’s article:
…the vast majority of American businesses, including some large, well-known companies and prominent Wall Street firms, actually do not pay corporate taxes at all…Beginning in earnest in the 1980s, millions of businesses shed their traditional corporate status to become what are known as pass-through companies. That led to a boon for business, but was a drain on the Treasury.
What the article makes clear is that the pass-through has helped smaller and mid-size companies grow and flourish, but has also enabled the mega-companies avoid paying as much, if any, corporate tax.
According to data from the Office of Management and Budget and the IRS, cited in the NY Times article, corporate income tax, as a percentage of GDP, has dropped from 7% in 1950 to 1.5% currently. Likewise, pass-through corporations have recently surpassed traditional corporations as a source of business income.
My mother was a tax consultant. Her favorite story at tax time each year was to remind me of what brought the iconic gangster Al Capone to his knees. “Not the FBI and J.Edgar Hoover, Ellen. No. It was the IRS. Sent him up the river.”
So I am comprised of molecules that scream, “work the tax rules to your maximum advantage, but NO cheating.” Maybe the large corporations aren’t cheating exactly, but if that’s the case, is it time to (finally) reform and overhaul our tax laws?
Until that happens, turn me into a humongous multi-national corporation before April 15. Special bonus: thanks to the Supreme court, I’m still a person.