It’s taxes again
tax during the Civil War, it almost caused a second tax revolt. It was repealed at the war’s end. And today, compared to other developed countries, are we really overtaxed as Trump claimed during the campaign?
Among industriallydeveloped nations only Chile and Mexico pay less taxes as a percentage of national income (GDP). How does Trump get by with such outrageous claims? Either because people are too lazy to check the facts or don’t really want to know. On a world comparison scale the Scandinavian countries pay the highest taxes, almost 50 percent of GDP. The northern Europeans are next with levies in the low forties and high thirties. We pay 26 percent. Only the U.S. corporate rate is comparatively high at 35 percent. But nobody, and I repeat, nobody actually pays the maximum rate. Through generous deductions, write-offs and other creative loopholes, many major American corporations paid no taxes at all last year, none. Realistically we should bring our corporate tax structure more in line with the rest of the industrialized world and, at the same time, minimize loopholes. Pfizer Corporation is rumored to be looking to a merger with an Irish pharmaceutical firm in order to move its headquarters there and take advantage of the lower Irish corporate tax rate. But the corporate rate is not Trump’s first order of business.
Talk is being revived of a “tax adjustment” which is a code word for another healthy tax cut for the wealthiest less-than one percent and a token reduction for the rest of us. This is supposed to “get the economy moving again.” But I’ll say again, spending and investment by the wealthy elite is never inhibited by a shortage of money. But they will invest only when they see opportunities for increased dividends and capital growth, not when they simply have more money in their pockets. To truly stimulate economic growth tax cuts should be given to the middle-income and bluecollar folks who will spend it on real estate, cars, appliances and other consumer goods. This spending, not tax cuts for the rich, makes the economy grow. George W.’s 2002 and ‘04 “tax adjustments” were followed by some of the slowest economic growth in decades.
Get out your pen or crank up your email and tell your congressmen that you want a fair tax cut that truly stimulates the economy, not one proposed for the richest dudes. Actually, I don’t see how any American can realistically ask for a tax cut anyway considering the humongous repair bill for our fastfailing infrastructure that is facing us, our failed public education system and a Middle Eastern war we can seem to neither win nor end. But that’s another subject.
George B. Reed Jr., who lives in Rossville, can be reached by email at email@example.com.