Any tax increase imposed on a corporation or business is passed along in one or more of these three ways.  First, the business can raise its prices to cover the tax increase.  Second, it can take a hit to the bottom line (earnings) of the business.  Lastly, and most likely, the tax increase will fall on employment levels.  The company will either cut back on hiring or lay-off employees to protect its earnings and shareholders.

In light of this, the Obama’s administration proposal to tax the overseas earnings of U.S. corporations (by increasing their taxes by $122 billion over the next decade), will further disrupt the goal of reducing our unemployment levels.  Worse yet, to escape this punishing tax increase, many U.S. companies will move their corporate headquarters overseas.

All this proves the old saying that the power to tax is the power to destroy—U.S. jobs in this case.  Bad policy, even for the best of reasons, is still bad policy

The Myth of Corporate Taxation is a post from: Business Speaker

If you tax away opportunity from those who have made it, do you not also tax it away from those who wish to make it?  You can’t hurt one without hurting the other. 

Class warfare does not work!   The parts of our economic system are all connected.  There are no winners with this policy.

Be Solvent & Prosperous,

Sanford Kahn, Business Author/Speaker

sanford16@yahoo.com

sanford16@yahoo.com

The Government Attack on Opportunity is a post from: Business Speaker

A VAT will hit the economy like a steam locomotive. It will be particularly damaging to the American middle class. These tax increases along with the expiration of Bush’s tax cuts will drive the economy into a second and more serious recession.

Be Solvent & Prosperous,
Sanford Kahn, Business Author/Speaker
www.businesstrendspeaker.biz
sanford16@yahoo.com

Mark My Words>>>A VAT (Value Added Tax) is Coming is a post from: Business Speaker

In the 1920’s then Secretary of the Treasury Mellon went through an exhaustive study to determine what top incremental income tax rate would maximize income to government yet, also, provide meaningful incentives for individuals to take business risks.  The answer was a top rate of 25%.   This is far lower than the current top rate of 35% and probably going higher due to rapidly rising Federal deficits.

Once you raise the top Federal tax rate above 25%, you hit what is called “the law of diminishing returns”.   Raising rates above 25% will produce far less revenue than is expected and also have the perverse effect of slowing the economy further—OR—finally tipping a stall speed economy into a serious recession. 

Bad policy, even for the best of reasons, is still bad policy.

Be Solvent & Prosper,

Sanford Kahn, Business Author/Speaker

The 25% Solution is a post from: Business Speaker

The one thing the government should NEVER do is to raise taxes when we are in a recession or just barely crawling out of if.  Unfortunately, this is what our Congress is going to do to promote their political interests.

First will come the tax increases associated with Obama’s health care proposal. Next will be the tax increases due to the expiration of Bush’s tax cuts.  They expire at the end of 2010.  The top marginal income tax rates will increase and so will the capital gains tax.  The 900 pound gorilla tax increase will be the taxes (passed on as costs) associated with the administration’s carbon cap  and trade.  This will hit the middle class particularly hard.

If these increases materialize, then the economic upturn we have will be brief.  The economy will slide back into recession in late 2010 or early 2011.  There will be a big price to pay.

Be Solvent & Prosperous,

Sanford Kahn, Business Author/Speaker

The One Thing You Never Should Do Is? is a post from: Business Speaker