Monday, February 21, 2011

Free Lunch

I was trying to find information on the federal budget and national debt recently and came across www.federalbudget.com. It didn't have the information I was looking for, but it did have a section about corporate welfare. I clicked on the link and found that rather than revealing examples of government bestowing special treatment on favored corporations, it was simply an argument for giving corporations a free ride, claiming:

Corporations don't pay taxes. When you buy stuff, you pay their taxes for them.

- This is known as embedded taxes, and it does NOT show on your cash register ticket.
- This form of taxation hits low income folks the hardest because it's a higher percentage of their income.

Now I've been a little uneasy about oil prices going up again. Maybe if Big Oil didn't have to pay all those taxes, gas would be cheaper. Unfortunately, corporations like Exxon get tax refunds from the United States, and pay the lion's share of their taxes to places like Nigeria, Abu Dhabi or the Cayman Islands. Most corporations have figured out ways to avoid paying US taxes, as reported in the New York Times:

Study Tallies Corporations Not Paying Income Tax

Published: August 12, 2008
Two out of every three United States corporations paid no federal income taxes from 1998 through 2005, according to a report released Tuesday by the Government Accountability Office, the investigative arm of Congress.

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