re: Corporate income tax is borne primarily by labor and workers, research shows.

I hear similarly dumb word games from mutualists who want to transform everything into a worker-owned co-op. "Corporations don't even really exist maaaannn" isn't very convincing then or now.

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I happen to think my employer is well above average when it comes to employee compensation and the treatment of its employees in general, but I know for a fact it isn't the only employer who acts like that. Many individuals will benefit from their employer's tax savings. It pisses me off that folks are trying to kill this simply due to partisan leanings.

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Every bill has to deal with partisanship. That said, I think there are legitimate fiscal concerns here. $1.7 billion over 10 years is a lot to make up for through alleged growth. And that's assuming we can find a way to come out neutral. Does nothing to address the current deficit level and long-term debt. If this tax cut doesn't live up to its laffer curve expectations, the next generation is gonna be fricked

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The point of this thread, which I derailed by going too abstract, is to discuss the incidence of the corporate income tax.

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Can we go a step further and acknowledge that the point of discussing incidence of the corporate tax is to defend the position that cutting it would actually be a tax cut for workers?

That is the point, yes?

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Sure, and this is where I get lost in the literature, to be honest. Let's say there are 2 periods, one before the corp tax, one after. I understand why a company can pass on their tax bill to workers in the form of lower wages. What I can't understand in my mind, intuitively, is why cutting the corp tax rate would incentivize them to raise the wages back to what they were before the corp tax was levied.

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The theory would be that investors interested in profitability would incentivize the company to use tax savings to increase wages, thus attracting better talent and/or compelling better employee performance, which would also drive profitability. I guess.

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Corporate income tax is borne primarily by labor and workers, research shows.
Important to remember when debating tax reform.

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US corporate tax is a ~39% internal tariff.

Think about that.

A 39% tariff!

This conclusion required absolutely zero research. It only required a brain

not sure what you're asking. was it answered at some point in the thread?

eta: this was the best-looking recent thing I've seen on this. they updated it last summer and i don't know how you could really throw down on the method, but maybe you do LINK

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The idea that tax cuts get passed on to workers is kind of ridiculous.[/quote

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Oh look. Another liberal who doesn't understand business or economics

Here's my shocked face

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No, I sort of agree. There is no inherent reason a business with more profit is going to pay its workers more, unless competition for labor increases.

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not for nothing but how did you even write the above sentence and not see the problem?

I really don't understand how people don't get economics. Your average 12 year old with a lemonade stand understand economics better than your average American adult

If I and all of my competitors suddenly have more money in our pockets then that means we all have more available to pay our employees. I know this doesn't mean we will just suddenly start handing out pay raises

But economics 101 here buddy. The next time I have to hire somebody I will be competing for the best employees with all of my competitors who also have more money in their pockets.

I also find it funny how no one's seems to understand the economic effects of a company having more money but they perfectly well understand the economic effects of a company having less

If all companies suddenly have less money they may not reduce pay for their current employees but they will have less available to hire more employees and when they do hire more employees they won't have as much to hire them with

I am so over how fricking economically ignorant 90% of America is. I would venture to say virtually every problem in America stems from that reality

The linked article linked in the OP is a disingenuous straw man argument.

The question is NOT whether labor or capital pays corporate taxes that are already levied and in place. The author spends his whole article explaining how complicated it is to allocate the payment of taxes between labor and capital. He's doing that to distract you from the fact that he is answering the wrong question.

The QUESTION IS - if a portion of the taxes already levied and in place are removed, what then would the corporation do with the monies that were previously allocated to paying those taxes.

Remember when the TARP funds where distributed to corporations? The purpose of the "bail outs" were to provide the companies operating capital to carry them through the effects of the great recession.

Remember what the wall streeters did with the TARP money?
They gave themselves their regular year end bonuses!!!

What makes anyone think that corporations are going to give anything close to a majority of the funds they had allocated for taxes to labor?

There already is talk about "investing" the tax-cut money into stock buybacks and dividend payments.

Some portion may go to labor as pay raises, but anyone thinking that pay raises to labor will represent a significant portion of the whole is buying the bill of goods being sold by the charlatan who wrote the article - and those who paid him to write it, hoping you would buy it.