Thinking About Taxes

The first point is to abolish corporate income taxation. This in particular has been a rallying cry for the right for a long time, but there are some sound reasons for supporting it.

It is the legal responsibility of any corporate officer to maximize profit. One of the ways to do this is to reduce expenses, and taxation is, potentially, a major expense. This has led to many companies "moving" their headquarters to low- or no-taxation countries while continuing to actually do business in the United States. In a number of cases, the offshore "headquarters" are no more than a mail drop, with the actual offices still at home. Eliminating the corporate income tax in this country would remove the incentive to violate the spirit, if not the letter, of the law.

Some on the left have made the argument that since corporations make use of the commons they have an obligation to contribute through taxes. I'll be addressing this further in the other two main points, but for now I'll just point out that this proposal only removes income taxes. Any taxes that are based on actual usage, such as gas taxes, licensing fees and even (real) property taxes are not affected here.

Second, tax all personal income progressively. That is, abolish the tax advantages that are currently granted to investment income. The right has been arguing for the opposite--to increase these allowances to the point of removing taxation entirely (they haven't succeeded in going that far, but it's frighteningly close). The rallying cry for this has been that it's "double taxation"--that the investor is being taxed on money that has already been taxed at the corporate level. With the elimination of corporate income taxes, this argument no longer has even the semblance of validity.

Integral to this is the principle of progressive taxation of income. The more you make, the greater the share of your income that you can afford to contribute to the commons. The increase in the rate, however, should never be so steep that one retains more money by earning less.

Finally, abolish the myth of corporate personhood. This isn't exactly a tax policy point, but it ties back onto the first point. Only persons pay income taxes, and corporations are not persons.

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