Issue of Corporate Taxes

Given that Corporate Personhood entitles Corporations to many (but not all) rights enjoyed by actual living, breathing, human beings, then one can certainly argue "by golly, they should pay like human beings too!" Benjamin Frankly is typically credited with making the statement that the only sure things in life are death and taxes. We already know that corporations more-or-less have defeated the death part by being perpetual entities (provided they are dissolved, nationalized, etc.). But what about taxes?

As entities, Corporations are theoretically taxed on their profits, and then when shareholders receive dividends on the profits, they are taxed on their individual incomes as well, leading to what is called "double taxation." Many people claim such a practice is unfair, and an example of a greedy government stealing away money from good ole everyday Americans. Of course, such a notion ignores the fact that much government spending benefits everyday Americans, whether it be through providing a national defense, emergency relief support, public road systems which facilitate transportation and commerce, support for education so people can earn a better life, and much more. It also ignores that "double taxation" basically occurs regardless of whether it involves a corporation or not. Say you earn a paycheck from work, which is naturally taxed as income. You then spend that already-taxed money buying groceries...well, guess what? You likely just paid a sales tax on the money you had earned, and the grocery store received payment from its sale, which will be taxed as income as well. It happens, it's not a mean anti-corporate conspiracy, deal with it.

This article from August 2008 details a report from the Government Accountability Office which studied corporate taxes in relation to corporate revenue. It determined that over a period from 1993 to 2005, 1.3 million U.S. companies each year paid no federal income tax. Another article, from "real Clear Markets," responded to the implications of the GAO report. It noted that the numbers reported by the GAO are misleading, as they compare corporate revenue to tax payments, not corporate profits. Corporations pay taxes based on their net profits, and if they had more expenses in a year than profits, naturally there would be no tax payment. The second article also contends that most corporations actually have a very narrow profit margin, at least compared to the revenue they may bring in. For example, a hypothetical company may bring in billions of revenue, but "only* rake in tens of millions in profit.

What I have to question is the legitimacy of some expenses. I have to assume that a normal person making $100,000 a year would still pay income tax on that $100,000 even if they had $110,000 in expenses over the year, as opposed to a corporation. U.S. corporate executives have notably higher salaries than executives in other countries such as Japan. The frequent argument made is that such high salaries are "necessary" to ensure that such apparently brilliant executives work for ones corporation instead of another. Given how some corporations continue to lose money even after hiring some of these people, it really calls into question the logic that these people are game-changing prodigies who are such excellent captains of the industry. We also hear about the lavish corporate parties that have been hosted at great expense, and obscene bonuses paid to officers even in times of debt and failing profits. Where is the accountability there? When one high-level executive alone is paid the same amount as hundreds or thousands of workers, I really have to question who is really the more valuable asset and should be the first to be cut in times of economic woe.