Democrats pass huge tax increase

[T. A. Gardner]

Its obvious that no one ever taught you about economics.

Then let me teach you some.

The 15% minimum corporate tax in this bill is slapped on any corporation's income--eg., before tax earnings--if those earnings exceed $1 billion in any consecutive three-year period to include foreign income that corporation may generate.

This will result in one of two behaviors for corporations close to exceeding the $1 billion three-year income limit and those that already exceed it.

For those close to the limit, above or below, the corporation is likely to adjust its business model to put it under the limit and thus avoid the tax. That is, rather than have 15% taken in taxes automatically, the corporation foregoes expansion or contracts such that it's potential in lost profits are less than the 15% tax and thus the corporation actually makes more profit than it would have exceeding the limit by a small margin.

For corporations above this limit, they can do several things. Diversify / divest such that the corporation becomes several smaller ones that don't exceed the limit why being held in an exempted--yes, there are exemptions for certain types of businesses and such--trust / investment fund. That means they now avoid the tax and retain their pre-tax levels of earnings. Or, they raise prices on goods and services they produce and pass the tax through to their customers. This is particularly true of businesses that have low competition. For example, say Boeing. They raise the cost of the military aircraft they manufacture to recoup the loss the tax will generate with the government essentially giving it back because there is no real alternative to purchasing from Boeing the aircraft they need.

It's simple accounting. Debits - Credits = Owner's Equity. If credits go up, and owner's equity remains constant then debits go up too to offset the increase in credits.

 

[Poor Richard Saunders]

pfffft, ok genius, educate us all on how corporations and energy companies are going to inform their shareholders that their stock decreased in value because they didn't pass on those extra expenses to their consumers.

it's obvious you don't grasp economics.

It's obvious you don't understand how a company's stock price is determined.

 

[MAGA MAN]

Yep, on a strictly party-line vote, the Democrats just passed another nearly trillion in new spending with tax increases on businesses and individuals. The Inflation Expansion Act now goes to Joke to be unleashed on the US people and economy.

https://www.msn.com/en-us/news/poli...pc=U531&cvid=f086206c72cd4709bedb43ef57588ad0

GovCo spending should be decoupled from GDP calculations.

 

[T. A. Gardner]

You keep making that argument that is ridiculous if you bothered to actually read the law.
https://www.democrats.senate.gov/imo/media/doc/inflation_reduction_act_of_2022.pdf

I have read the law. Corporations can avoid this tax in part by moving some operations offshore to gain the AMT foreign tax credit and avoid in part or whole paying the 15%. Corporations that are close to the $1 billion three-year income limit can choose to shrink or not expand to avoid it, thus the bill potentially limits corporate growth and expansion. For corporations above the limit, they will pass the costs through to maintain profits by raising their prices on goods and services.

 

[Poor Richard Saunders]

Then let me teach you some.

The 15% minimum corporate tax in this bill is slapped on any corporation's income--eg., before tax earnings--if those earnings exceed $1 billion in any consecutive three-year period to include foreign income that corporation may generate.

This will result in one of two behaviors for corporations close to exceeding the $1 billion three-year income limit and those that already exceed it.

For those close to the limit, above or below, the corporation is likely to adjust its business model to put it under the limit and thus avoid the tax. That is, rather than have 15% taken in taxes automatically, the corporation foregoes expansion or contracts such that it's potential in lost profits are less than the 15% tax and thus the corporation actually makes more profit than it would have exceeding the limit by a small margin.

For corporations above this limit, they can do several things. Diversify / divest such that the corporation becomes several smaller ones that don't exceed the limit why being held in an exempted--yes, there are exemptions for certain types of businesses and such--trust / investment fund. That means they now avoid the tax and retain their pre-tax levels of earnings. Or, they raise prices on goods and services they produce and pass the tax through to their customers. This is particularly true of businesses that have low competition. For example, say Boeing. They raise the cost of the military aircraft they manufacture to recoup the loss the tax will generate with the government essentially giving it back because there is no real alternative to purchasing from Boeing the aircraft they need.

It's simple accounting. Debits - Credits = Owner's Equity. If credits go up, and owner's equity remains constant then debits go up too to offset the increase in credits.

OMG... You really have not read the bill, have you?
https://www.democrats.senate.gov/imo/media/doc/inflation_reduction_act_of_2022.pdf

PART 1—CORPORATE TAX REFORM1
SEC. 10101. CORPORATE ALTERNATIVE MINIMUM TAX.

Simple accounting would show that the majority of large corporations that earn $1 billion in income annually would never be subject to the AMT since they already pay the standard corporate income tax rate.

 

[T. A. Gardner]

OMG... You really have not read the bill, have you?
https://www.democrats.senate.gov/imo/media/doc/inflation_reduction_act_of_2022.pdf



Simple accounting would show that the majority of large corporations that earn $1 billion in income annually would never be subject to the AMT since they already pay the standard corporate income tax rate.

What does that have to do with what I stated? If the corporation isn't affected by this provision, that's not an issue. If it is, what's to stop that corporation from mitigating to the maximum extent possible the effects of this tax as I demonstrated.

 

[Poor Richard Saunders]

I have read the law. Corporations can avoid this tax in part by moving some operations offshore to gain the AMT foreign tax credit and avoid in part or whole paying the 15%. Corporations that are close to the $1 billion three-year income limit can choose to shrink or not expand to avoid it, thus the bill potentially limits corporate growth and expansion. For corporations above the limit, they will pass the costs through to maintain profits by raising their prices on goods and services.

Really? You sure you read the law?
How does the law look at the business conducted in the US by a foreign based company?

 

[Poor Richard Saunders]

What does that have to do with what I stated? If the corporation isn't affected by this provision, that's not an issue. If it is, what's to stop that corporation from mitigating to the maximum extent possible the effects of this tax as I demonstrated.

The foreign tax credit can be used to reduce US taxes. If you owe the US $1M in taxes but have paid $.5M in Ireland you can reduce your US taxes by that .5M. That doesn't suddenly reduce your overall taxes. It only changes where you paid your taxes.

 

[T. A. Gardner]

Really? You sure you read the law?
How does the law look at the business conducted in the US by a foreign based company?

Hard to say. I don't know the full law on the AMT foreign tax credit, and that isn't in this bill. I also don't know what the applicable sections of IRS tax code cited in the bill read in full. There are some modifications to these, but I can't fully tell what those would do to the overall regulations as they exist. I doubt you know any of that either. What I do know is if a corporation is going to get hit with higher taxes, they aren't likely to sit still and take it in the ass without modifying their behavior to avoid it.

 

[T. A. Gardner]

The foreign tax credit can be used to reduce US taxes. If you owe the US $1M in taxes but have paid $.5M in Ireland you can reduce your US taxes by that .5M. That doesn't suddenly reduce your overall taxes. It only changes where you paid your taxes.

And, if those taxes are lower in some other nation, then you can do more with what's invested because of that lower tax rate.

Example: If you have to pay the US a tax of $100 on $10,000 in earnings, and you can write that off by paying a tax of $100 to some other country on $100,000 in earnings, it's better to move to the low tax country and avoid the US taxes by writing off your foreign earnings since the AMT only looks at the taxes paid. That is, you minimize your US footprint because it's more profitable to do stuff in a low tax country.

 

[LurchAddams]

Yep, on a strictly party-line vote, the Democrats just passed another nearly trillion in new spending with tax increases on businesses and individuals. The Inflation Expansion Act now goes to Joke to be unleashed on the US people and economy.

https://www.msn.com/en-us/news/poli...pc=U531&cvid=f086206c72cd4709bedb43ef57588ad0

Don't worry. It's only for the rich. Your taxes will likely decrease, trailer. Congrats!

 

[Celticguy]

I'd say about 6 years. But I'm going by The Bible.

7 years of famine. In the end times.

Grr! Why could I not have been born earlier? No choice but to deal with it.

That bill is economical suicide.

I worry for my daughter and her family. Fortunately she is a nurse and there are never enough of them but it will impact them more than I.

Just have to buckle up and see to it that they cant fuck it up more... ever...

 

[LurchAddams]

wonder how much longer this drives the recession?

Why don't you tell us? Nevermind, you know nothing.

 

[Poor Richard Saunders]

And, if those taxes are lower in some other nation, then you can do more with what's invested because of that lower tax rate.

Example: If you have to pay the US a tax of $100 on $10,000 in earnings, and you can write that off by paying a tax of $100 to some other country on $100,000 in earnings, it's better to move to the low tax country and avoid the US taxes by writing off your foreign earnings since the AMT only looks at the taxes paid. That is, you minimize your US footprint because it's more profitable to do stuff in a low tax country.

And are you stopping all business in the US because until you do any business you conduct in the US subjects you to the AMT.

 

[LurchAddams]

I'm wondering how many corporations will re-headquarter somewhere they won't be forced to fork over 15% of their profits automatically regardless of any other circumstances or deductions...

Corporations are welcome to re-headquarter anywhere. And if they do that, American consumers are welcome to patronize their domestic competitors. Don't you believe in the "free market", twumptard?

 

[LurchAddams]

if the diaspora to the Caymons last century is any indication, quite a lot.

as interesting will be how many flee Delaware known for its friendly tax situation.

Your first sentence is nonsensical

Regarding your second sentence - no one's leaving Delaware. Taxes went up during the Clinton administration on the wealthy and corporations and we had 8 years of growth.

You're an idiot.

That is all

 

[LurchAddams]

I find it hilarious that the radical Lefties here won't defend their own when they pass totally fucked up legislation and assfuck Americans in the process. It's as if they are addicted to economic porn and snuff videos...

Well, I guess us "radicle lefties" just don't subscribe to the same evil propaganda you do, twumptard fuck.

 

[LurchAddams]

Massive tax increase coupled with fiat money spending.

It also raises the cost of energy, so that will contribute to continued inflation.

OH! Please! Tell us how the bill's going to increase energy prices! We can't wait to hear this

 

[LurchAddams]

if you don't understand that those taxes are going to be passed on to the consumer, you're a moron of the highest caliber.

Please explain how Clinton signed a bill raising taxes on the wealthy and on corporations his first year in office and then we had 8 years of unprecedented economic growth with zero wars.

Please show us you work:

 

[SmarterthanYou]

It's obvious you don't understand how a company's stock price is determined.