Essay - Pros and Cons of Dropping or Lowering Corporate Taxes Abstract:...

pros and cons of dropping or lowering corporate taxes

*****: This is a paper with two charts concerning ***** taxes. Corporations are taxed under a tax rate structure depending on the income. There has been talk about dropping the corporate *****. Th***** paper will discuss the pros and cons of this. What methods can be used to drop or lower corporate taxes ***** why?

HOW CORPORATE TAXES HELP OUR ECONOMY

Where did ***** corporate ***** tax begin? How does it affect our economy? ***** is the future ***** the corporate income tax? Will deleting corporate income tax be the answer for the economy? What about cutting part of this tax? ***** does the corporate income tax help the economy? *****ese ***** questions that ***** ***** answered in this paper as well ***** how the corporate ***** is affecting ***** economy now.

The Beginning ***** Corporate Income Tax

How the corporate tax began is an example of ***** tax systems can be worse than they should be and how l*****tle influence the economic pr*****ession has on government policy (Norton 2). Sometimes ideals look great when ***** are not that sound. Corporate *****es were ***** during wartime until 1909, ***** Congress enacted a 1 percent tax on corporation income. The rate increased until ********** to 12.5 percent when the rate was changed to the progressive rates. ***** stated, "Surtaxes on ***** income were added for "excess profits" ***** both world wars. The highest peacetime rate, 52.8 percent, was reached in the sixties" (2).

Back ***** the forties and fifties ***** corporate income tax provided almost a third of feder*****l revenues. In 1966 it ***** 23 percent. Over the next twenty years the tax declined. "***** top corporate tax rates fell from 52.8 percent in 1969 to 46 percent ***** 1979. Tax laws gave generous deducti*****s for capital expenditures. ***** profits averaged 11 percent in the sixties ***** less than 5 percent from 1981 ***** 1985.

***** 1986 Tax Re*****m Act

In 1986 the Tax Reform Act increased the sh***** of federal ***** from ***** corporate income tax and decreased the share from the individual ***** tax. Both the corporate income tax and ***** income tax ***** cut to 34 percent; however, deductions for ***** were curtailed and the investment tax was repealed (Norton 2).

Most economist will agree that corporate taxes is one of the least efficient and ***** defensible ***** taxes. Most will recognize that no one knows who really *****ars the burden of corporate taxes. The man on the street will probably say, "Let the big companies be taxed." The corporations usually take the increase in taxes and place it on ***** consumer by raising prices on the product. Some companies decide to become an "S" corporation. If ***** company becomes an "*****" corporation then it ***** not pay ***** tax. Its income is passed ********** taxed to shareholders. The growth of "S" *****s and the growth of ***** net income ***** an example of the measurement problems. Changing *****