DYSPEPSIA GENERATION

We have seen the future, and it sucks.

Who Pays the Corporate Income Tax

21st February 2013

Bruce Bartlett does The Big Reveal.

The problem, of course, is that people must ultimately pay all taxes. Corporations, contrary to the views of some Republicans, are not people. They are legal entities that exist only because governments permit them to and are artificial vehicles through which sales, wages and profits flow. Hence, the actual burden of the corporate tax may fall on any of the groups that receive such flows; namely, customers, workers and shareholders, the ultimate owners of the corporation.

Shocking! There oughta be a law! Oh, wait….

Most economists now agree that the burden of the corporate income tax falls on labor to some extent, but there is disagreement over the degree. This is important because the political prospects for cutting the statutory corporate tax rate, a goal shared by all tax reformers, may depend on the extent to which it can be shown that workers will benefit.

And the extent to which the truth can win out over the demagoguery that typically dominates such conversations.

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