Credit: AP Photo/Elise Amendola
A surprising new estimate finds that only 24% of US corporate stock can be taxed by the US government because the rest is held in tax-free accounts. (emphasis added)
The research from the Tax Policy Center has important implications for the debate over corporate tax reform in the US and how to tax capital in the new US gilded age.
While cries of double-taxation of corporate profits abound in arguments against steeper taxes on capital gains, many of America’s largest corporations use aggressive tax planning to shift profits overseas and reduce taxable revenue, shielding these earnings from the first step in taxation. And according to the Tax Policy Center, a centrist think tank operated jointly by Urban Institute and Brookings Institution, “relatively few shareholders pay the second level of tax on corporate earnings,” leaving a major stream of income out of the reach of public coffers.
By law, owners of US corporate shares must pay a tax on their gains when […]
