http://www.addictinginfo.org/2011/09/17/texas-republican-representative-introduces-bill-in-congress-that-would-eliminate-corporate-taxes/Representative Louie Gohmertz has a jobs plan. Well, he has a plan anyway. Gohmert says his bill will create jobs. If we were in a dream world, perhaps. One thing Gohmert’s bill will do, is completely eliminate the corporate tax rate.
That’s right, Republicans are ignoring jobs again in an effort to kill corporate taxes. The corporate tax rate is comparable to most developed nations in the world at 35%. But Republicans are aiming to give corporations the kind of tax rate that not even most third world countries allow: 0%. Even though cutting taxes has never created jobs, Gohmert claims his bill does just that.
“It is a very simple bill, which will eliminate the corporate tax which serves as a tariff that our American companies pay on goods they produce here in America. This bill will actually create jobs in America.”
The problem with Gohmert’s claim is that corporations are already sitting on trillions of dollars in cash. Lowering the tax rate will only give them MORE cash to sit on. They certainly won’t be inclined to spend that money on labor here in America. Every time we have lowered the corporate tax rate, it hasn’t created jobs in America. It creates jobs overseas for citizens of other nations, but not for Americans. How do I know all of this? Because corporations already pay zero in taxes. They haven’t paid income taxes for years. All the loopholes and deductions they take advantage of equals a zero percent tax rate. And that hasn’t created a single job. How would making a zero percent tax rate official be different? The answer is it wouldn’t. According to the CBO, cutting taxes on businesses “typically does not create an incentive for them to spend more on labor or to produce more, because production depends on the ability to sell output.”
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