Hacker News Reader

Comment by apedley | Hacker News Reader

The tax breaks for the middle class are only temporary. Most CEO's are praising them because it's great for them and shareholders. Most CEO's acknowledge they will use the additional profits to perform share buy backs.

While the middle class got something, the majority went to the wealthy, and as per my previous comment on shares, they are not going to be flooding it back into the economy.

Also US corporate taxes were about median for the world, they were not absurdly high, you should check out some countries in Europe for that.

View on HN

See this NPR[1] article which listed the previous US corporate tax rate as the highest of advanced economies. This included France, Belgium, Germany. Also fun fact, go visit Dublin and see all the tech companies (Google, Facebook, Microsoft, etc) who have a Europe HQ there. The reason, they have a 12.5% corporate tax rate.

[1] https://www.npr.org/2017/08/07/541797699/fact-check-does-the...

The effective US corporate tax rate is more median. Our headline tax rates were higher, but we also had larger deductions and tax credits.

That is a very bad policy to have though because it encourages wasteful spending on tax avoidance and rewards the companies that do it. It also gives an artificial competitive advantage to the largest companies, who have the scale to invest in complex tax avoidance schemes, at the expense of smaller more productive companies.

If you see the chart just below the first one, the actual tax rate is roughly median with the rest of the world. The CBPP[1] article explains further.

While some countries offer low tax rates or incentives, they are to attract international business because they have no other means to attract them. The US is not like Ireland in this respect.

US companies have had record profits recently. The big tech companies like Apple are hoarding cash reserves. Why is giving them more cash going to change their approach?

[1] https://www.cbpp.org/research/federal-tax/actual-us-corporat...

Reply on news.ycombinator.com