Corporate Tax And Corporate Income Tax

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Introduction I believe that there should be corporate income tax, as it acts as a “user fee” for the “special privileges” (Rosen, Ch 19) corporations receive. The corporate income tax is a separate tax on corporate income, in which varies in a bracket between ten percent and thirty five percent. The effective corporate income tax rate is estimated at thirty two percent, and eighteen percent for non-corporations. Workers compensation, labor expenses, interest payments, and depreciation are tax deductible from taxable income. Since corporations sell stock to stockholders, those stockholders purchased a certain percentage of the corporation. In turn, purchasing a portion of the corporate liability. If a stockholder accumulates income within the corporation in which he holds stock shares, he reduces his tax liability. Although the shareholder’s additional income would eventually be taxed, his stock will grow at the before-tax rate of interest. This benefits the corporation and the shareholders, as neither party holds the entire liability, nor do the shareholders pay debt if the corporation is not generating profit. Corporate income tax also preserves the integrity of personal income tax. I believe that there should be corporate income tax, as the lack-there-of could create “potential opportunities for personal tax avoidance” (Rosen, Ch 19).
Corporate Income Tax Incidence The corporate income tax incidence is dependent on whether the perspective is from the short, long, or

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