The Harvard Business Review offers up seven facts about corporate taxes. 

Economists hate the corporate income tax. Double taxation is one issue. Another is that a tax on corporations is generally a tax on productive investment, and economists think we need to invest more in productive things (as opposed to say, housing). Yet another is that corporations are more mobile than individuals, and taxing them might cause them to move their operations elsewhere. Some also argue that taxes on corporations end up falling most heavily on those corporations’ employees. And there are other objections. One can find economists of widely varying political beliefs who think the optimal corporate tax rate is zero, or at least much lower than it is now.

 

In late 2011, JLF’s Vice President for Research, Roy Cordato, offered these key points:

  • The corporate income tax imposes a second and even a third layer of taxation on people’s incomes and is hidden, dishonest, and inconsistent with informed decision making in a free and democratic society.
  • North Carolina has had a corporate income tax since 1921. Between 1921 and 1991 the rate increased from 3 percent to 7.75 percent. It was then lowered every year between 1997 and 2000 to its current rate of 6.9 percent.
  • The corporate income tax is riddled with special exemptions meant to facilitate government manipulation of the economy.
  • The corporate income tax is based on the myth that corporations actually pay taxes. In fact ,corporations not only do not pay taxes, they cannot pay taxes.
  • All taxes “paid” by a corporation must come out of real people’s wallets or bank accounts. These real people are shareholders, employees, and customers.
  • In order to make intelligent voting decisions, citizens need to be aware of how much their government is costing them. The corporate income tax is a deceptive tax because it is invisible to those who are paying it.