Inevitable
At some point, some smart major exporting nation is going to realize that since businesses and corporations don't really pay taxes— firms have no choice other than to embed the additional cost of taxes into the prices of the goods or services they sell along with their other costs of doing business— it makes more sense in a globally competitive world to take those taxes directly from their citizens instead of indirectly via businesses. Free from having to collect taxes from their customers for the government, that nation's businesses and corporations would gain an immediate, painless cost and price advantage over their international competitors whose governments continue to tax them.
When this inevitably happens, the other major-exporting nations of the world, including the United States, will eventually have little choice other than to follow suit. But the nation that started it all will still have cultivated a head start that will produce competitive advantages for years after other nations have joined them.
Since the United States, as a major exporting nation, is predestined to forego business and corporate taxation anyway, why can't we be the ones to do it first? Remember all of those US corporations that have steadily moved offshore over recent decades? Many if not most of them will turn around and come back— and bring their job opportunities back to America with them. Starting job-creating new ventures will become much easier when nascent enterprises will no longer have to bear the expensive and time-consuming burden of complying with multiple levels of complex tax rules and procedures along with the demands of their business. Our companies would also become stronger when they can finally base all of their strategic decisions on the actual demands of the marketplace instead of having to forgo expansion and improvement due to arbitrary tax reasons.
When all is said and done, the increased demand for labor and the upward pressure that demand will apply to wages and salaries will make American workers the big winners.
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Posted by: Peter Jackson on June 11, 2006 09:50 AM
Hey Robby!
Probably the most famous slogan to communicate this is "corporations don't' pay taxes, they collect them." I prefer to simply argue that the poor are the ones that are left holding the bag right now under the current system. If those taxes were shifted from the production side to the consumption side of the equation with sales taxes, they could then be mitigated with exemptions for necessities such as food, medicine, and rent. As it stands, even the poorest of the poor are forced to subsidize taxes on business.
yours/ peter.
Posted by: Lance on June 15, 2006 01:56 PM
Robby,
I suggest tax the rich. I know it is a mixed message, but if across the board tax cuts can be portrayed as benefitting the rich, an across the board tax raise to offset the revenue loss can be portrayed as soaking the rich. Besides if we took out of politics (at least successful politics) mixed messages, what would be left?
Posted by: ThePoetOmar on July 01, 2006 10:07 PM
Hi Peter! I'm glad to have a chance to get registered here and have a chance to really check out your blog. I've enjoyed your posts over at QandO and I suspect that I will enjoy your work here even more.
This is a great idea, especially given that American companies honestly do prefer to employ Americans. A lot of the offshore employment issues are directly related to taxation and I really belive that many of the companies really do move to India, or the Phillippines, or wherever with a great deal of anxiety and regret. If Congress could summon up the vision and courage to pass a package like this, the US economy would be set for at least the next twenty years or so.
Posted by: Peter Jackson on July 02, 2006 09:44 PM
Omar!
Thanks for taking the time to stop by and leave some thoughtful comments. I've enjoyed reading your perspectives over at QandO as well.
And yeah, I personally believe that we could get most of our companies back, meaning all but maybe a handful. And furthermore, I'd also like to think that a lot of blue-chip foreign companies who are currently struggling in their post-socialist home countries would take the opportunity not to move into the US, but move to the US. There's no law sayiing that outsourcing can't work both ways 
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How do we wean the government off the business tax teat? And what's our answer for the inevitable howls from the left that we are out to cornhole the poor in favor of big, evil corporations? I mean, I get the logic, but we will need some soundbites.