They’re making money but paying no taxes
Want to know where to find America’s biggest tax deadbeats? In the executive suites of most of its corporations.
From 1998 to 2005, almost two-thirds of companies in the United States paid no corporate income taxes, according to an investigation by the Government Accountability Office, the watchdog agency of the federal government.
They did so by recording sufficient expenses to cancel out their profits, which collectively amounted to 14.1 percent of the nation’s total income in 2006, according to the New York Times. This suggests that they have become so skilled at tax-avoidance strategies that the government can’t touch them.
Meanwhile, the nation’s debt has grown by nearly $4 trillion under the Bush administration, from $5.7 trillion to $9.5 trillion. Annual interest payments on that debt amount to $406 billion, about equal to this year’s budget deficit of $410 billion. In 2001, when George W. Bush took office, the budget deficit had been eliminated.
The primary causes of the increases in debt and deficit: Bush’s tax cuts and the wars in Iraq and Afghanistan. The fact that so many corporations aren’t paying any taxes on their profits certainly doesn’t help matters.
This fiscal imbalance is one of the major causes of the declining dollar and America’s current recession. It needs to be addressed. The positions of the two presidential candidates regarding taxes are, thus, hugely important.
Barack Obama wants to let the Bush tax cuts on the wealthy expire in 2009, as originally intended; John McCain wants to make them permanent. Obama wants to end corporate tax havens and close special-interest corporate loopholes so more companies pay their fair share of taxes; McCain supports reducing the corporate tax rate from 35 percent to 25 percent.
When Obama accuses McCain of being an extension of the Bush administration, this is what he means. America’s increasingly precarious financial condition must be addressed head-on, and only Obama seems willing to do that.