The rich will con­tinue to avoid pay­ing taxes

The Buffalo News - - OPINION - Su­san M. Davis

We now know the rich are hid­ing their in­comes in tax havens around the globe. Sure, these hun­dred-thou­sand or so house­holds will spend some in­come in the U.S. on pri­vate planes, yachts and other sig­ni­fiers of wealth. But this will hardly keep the United States econ­omy hum­ming. So can we let go of the trick­le­down myth now?

These rich tax evaders are also not con­tribut­ing to the com­mon­wealth by pay­ing taxes. So no sup­ply-side “mir­a­cle” ei­ther. (You re­mem­ber that gem: tax rev­enues will grow if we cut tax rates.) But then tax avoid­ance among rich house­holds and cor­po­ra­tions has been a thing since about the time Laffer drew his fa­mous graph on a cock­tail nap­kin at a D.C. party. So can we now also let go of the sup­ply­side mir­a­cle myth?

You’d think the rich and cor­po­ra­tions who have grown wealthy be­cause of what this coun­try of­fers would be more pa­tri­otic. Try do­ing busi­ness in Rus­sia or some other coun­try where an au­to­crat can just con­fis­cate what you have, or in failed states where prop­erty rights and con­tracts aren’t al­ways en­forced, where ac­cess to elec­tric­ity, roads and other in­fra­struc­ture is in­ter­mit­tent, or where in­vest­ments in peo­ple are so min­i­mal you can­not find a work­force healthy enough, much less ed­u­cated enough, to main­tain your busi­ness.

The rich cor­po­ra­tions and in­di­vid­u­als who would pay tax at­tor­neys and ac­coun­tants rather than their taxes are un­pa­tri­otic in­grates.

Can the mid­dle class be naive enough to be­lieve (again) that by low­er­ing the top mar­ginal in­come and cor­po­rate tax rates, these in­grates will stop try­ing to avoid pay­ing taxes – any­where?

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