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Some ideas from the web on the corporate income tax

I focused on some basic macroeconomic analysis of the likely effects of the tax bills last time. As this New York Times article pointed out over the weekend, many of the pros and cons being discussed in Washington involve taxation of corporations vs. individuals and noncorporate businesses. So one might also want to ask: Should a corporate tax even exist? What would be the most desirable reforms if one had the power to make changes?

The Citizens for Tax justice is a first-rate progressive think tank. It argues in this concise fact sheet that the corporate tax is needed from the point of view of a just tax code.

It argues in this 2016 policy piece that (progressive) reform of the tax is sorely needed to make sure it is working to make the system more progressive.

The CTJ’s view contrast with this Modern Monetary Theory (MMT) take on the desirability of a corporate tax.  It is offered up in working paper form by fellow blogger Nathan Tankus, a student at John Jay School of Criminal Justice, who also presented his views in a session at the Cross Border Post Keynesian conference in Buffalo this past summer (one highlight of the year for me, complete with a new and interesting resort and city and even vegan Amtrak cuisine!). The paper is called “Corporate Taxation in a Modern Monetary Economy: Legal History, Theory, Prospects” and this pdf link is at the MMT-friendly Binzagr Institute.

I think the two views make a nice contrast of nontechnical views on the corporate tax issue and suggest them in the interest of offering some complementary insights for readers at a crucial time when a policy decision is being made. The tax reform bill will probably be passed in final form this month or next month, according to most accounts.

For readers of this blog, another concern relates to implied or allegedly implied cuts in (a) big entitlement programs (addressed in this letter to the Times) and (b) more narrowly defined “safety net” programs (programs in which eligibility is based on economic need). I do not believe that they are implied or forced in any deep way, although Congressional Republicans and centrist Democrats indeed can and will bring up “entitlement reform” inevitably as part of their usual agendas, using an unjustified balancing rationale. I hope Donald Trump sticks to his campaign promise to leave Social Security and Medicare uncut; so far, his populist side has appeared to be offstage most of the time.

And one last web resource from the broadly defined Post-Keynesian school on this topic!: Working Paper 109, The Incidence of the Corporate Profits Tax Revisited: A Post Keynesian Approach by Anthony Laramie.


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