“Goldman Sachs economists say it’s more likely Congress approves tax cuts by next year, after a Senate deal on the budget resolution,” Patti Domm reports for CNBC. “”
“The economists say that the tentative agreement, announced by Republican Senators Bob Corker of Tennessee and Pat Toomey of Pennsylvania, would call for instructions for a tax cut of up to $1.5 trillion be included in the budget resolution,” Domm reports. “‘Our understanding is that this figure represents their view of what a ‘revenue neutral’ agreement would cost when scored conventionally,’ Goldman economist Alec Phillips wrote. Phillips said assuming expiring tax cuts would be extended, it would work out to $1 trillion in new tax cuts over 10 years, or 0.4 percent of GDP over that period.”
“The Goldman economists assume the tax cuts would be phased in and could boost growth by 0.1 or 0.2 percentage points of GDP in 2018-2019,” Domm reports. “The White House and Republican Congressional leaders are expected to release an outline of tax reform that includes a corporate rate in the low 20s, business investment incentives, profit repatriation, a move to a new territorial tax system, and middle-income tax cuts.”
Read more in the full article here.
MacDailyNews Take: As we wrote back in April: “We’ll see where it all ends up (the corporate tax rate won’t end up being 15%, but it may end up being 20-25%, which is certainly better than the stifling 35% it is now). As we’ve been saying for many years now, the U.S. corporate tax rate is way too high. Obviously.”
Under the current U.S. corporate tax system, it would be very expensive to repatriate that cash. Unfortunately, the tax code has not kept up with the digital age. The tax system handicaps American corporations in relation to our foreign competitors who don’t have such constraints on the free flow of capital… Apple has always believed in the simple, not the complex. You can see it in our products and the way we conduct ourselves. It is in this spirit that we recommend a dramatic simplification of the corporate tax code. This reform should be revenue neutral, eliminate all corporate tax expenditures, lower corporate income tax rates and implement a reasonable tax on foreign earnings that allows the free flow of capital back to the U.S. We make this recommendation with our eyes wide open, realizing this would likely increase Apple’s U.S. taxes. But we strongly believe such comprehensive reform would be fair to all taxpayers, would keep America globally competitive and would promote U.S. economic growth. – Apple CEO Tim Cook, May 21, 2013
SEE ALSO:
Apple will eventually bring billions of dollars back to the U.S. under President Trump’s tax reform plan – July 21, 2017
President Trump’s tax reform plan includes deep cuts in corporate taxes – April 26, 2017
Apple could be primed for profit explosion under President Trump’s big tax cut – April 26, 2017
Analyst: Apple could double dividend, buy Netflix with repatriated cash under President Trump’s U.S. corporate tax changes – March 17, 2017
Apple raises $10 billion in debt ahead of President Trump’s repatriation tax plans – February 3, 2017
After Apple’s blowout earnings, the Street looks toward ‘iPhone X’ and President Trump’s tax reforms – February 3, 2017
President-elect Trump’s corporate tax reform expected to have some positive impact on Apple EPS – January 14, 2017
Exploring Apple’s tax situation under U.S. President Donald Trump – November 21, 2016
Morgan Stanley: Apple stands to benefit the most from President Trump’s corporate tax plans – November 11, 2016
Apple and U.S. President-elect Trump: Can a tax cut for overseas cash heal wounds? – November 10, 2016
Donald Trump plan calls for cuts in corporate taxes, personal income tax rates – August 9, 2016
Barring a tax holiday, Apple will need to raise over $50 billion in debt the next 2 years – July 15, 2016
Cramer: Apple’s Tim Cook is ‘patriotic’ on taxes – December 21, 2015
Apple CEO Tim Cook is absolutely right – and wrong – on U.S. corporate tax policy – December 20, 2015
Apple CEO calls corporate tax rap ‘total political crap’ – December 18, 2015
Apple avoids $59.2 billion U.S. tax bill – October 7, 2015
U.S. companies now have $2.1 trillion overseas to avoid corporate taxes – March 4, 2015
I first I was wondering what this has to do with Apple until I saw your Tim Cook quote. Before you get all giddy on tax cut look at Kansas. The Governor put this idea to the test and failed. A Republican legislature finally stopped him and raised taxes to pay for the roads and schools and other government functions that have had to be defunded to death because the tax cut did not lead to jobs. When I was young I was very libertarian in my beliefs. However I have seen a lot of the B S in it. Government is not the solution to all problems, however it is not the evil beast either. There is also the 2 Santa Claus Republican policy. You have to look up the whole history. The short version is cut taxes (be Santa) and don’t worry about debt. When the Democrats are in power focus on the dept and make the Dems raise taxes and/or cut services (kill Santa). It has worked great.
When did governments decide they had the right to demand so much of one’s worth? And does any government truly earn the our trust to handle it without pissing away so much of it on special interest groups, pet projects or bloated bureaucracy? I’ve read a few studies which proclaim as much as 25-30% is wasted. Appalling really…
Pull a Dollar bill out of your wallet.
Who made it and who gave it to you?
it is just a piece of paper printed on with ink and only carries an assigned value because a government says it does. The moment you accepted one as a payment or gift you joined the economy. The rules are set by the government to include taxation.
…and use it inefficiently and unwisely.
Unfortunately, the government decided when they created the IRS and over the years carved out a zillion exemptions for the well connected …
Show me where any country can excel for long taxing their citizens to death?
None that I can think of.
As you pointed out in related posts, the money is wasted in RECORD amounts year after year after year with no accountability and lackluster results. I won’t even get into the taxpayer fraud that have sent politicians to jail at all levels of government year after year.
Back at you: How many cities or states can you think of that have solved problems for good by high taxation? …
Let me think hard about that….ummm…none?
Show me one that has lasted without taxing people to pay for services?
When did you calculate how much you have benefited from the many services the government provides?
Moreover, how callous could one be to not understand that society requires contributions from all?
Your house may never burn down, so does that mean all fire departments should be disbanded? By the selfish calculation, police fire and military services are all total waste. Right?
Not at all. Government over reach, bloated bureaucracy and layers of social programs are my enemies. We should expect so much more for our money than we do. And at the current rate, the taxpayer will one day give them more than he takes home…and for less. Then judgement day will be here I’m afraid.
How do US taxes compare internationally?
FEDERAL BUDGET
<4/4
Suggested reference: http://www.taxpolicycenter.org/briefing-book/how-do-us-taxes-compare-internationally
Q.How do US taxes compare internationally?
A.Total US tax revenue equaled 26 percent of gross domestic product (GDP), well below the 34 percent average for developed countries (figure 1).
It’s not really an apples to apples (pun intended) comparison unless you include the total composite tax burden of federal, state and local taxes per head.
State and local taxes are deducted from your federal taxes.
Perhaps the Tea partiers have their panties twisted tight because they don’t know how taxation is calculated?
Good point as long as you itemize.
“State and local taxes are deducted from your federal taxes.”
How does that work?
I get separate tax bills every year from the city I live in for right to work, then a separate bill for city taxes, then a separate tax bill for county taxes, then tax collection at tax time from the state and IRS …
Republicans like to whine about taxes while they enjoy the benefits made possible by government via taxes.
Surely your not talking about my beloved mortgage tax deduction that mostly benefits middle and upper income families…
There are people in this country who:
1-were raised in a house bought with a Federally Subsidized Loan.
2-went to public schools.
3-went to a public university and got either grant money or subsidized student loans.
4-drive public roads.
5-benefit from public safety (Police, Fire and EMS).
6-are served by public utilities (some combination of Internet, Power, Water, Sewer, Gas).
7-recreate in public parks.
8-are served by a Doctor and Dentist who probably received public assistance in education and a hospital that receives any number of public subsidies.
9-is served by a number of businesses that receive loans, grants, or other help from SBA and other activities of government.
10-goes to a Church, Synagogue, Temple or Mosque that gets a tax subsidy in the form of a tax exemption.
11-donates to various charities of their choosing that are subsidized by the charitable donations deductions.
12-gets to deduct state and local taxes from their Federal Taxes.
13- has a flex spending account with tax advantages to pay for out of pocket Medical Expenses and/or Childcare.
14- live in a flood control or levee district funded by taxes.
15-are defended by the US Armed forces, funded from taxes.
16-flew or rode on Airplanes that benefit from the Air Traffic Control System, National Weather Service and FAA owned Airports, flown by pilots commonly trained by the Military with tax dollars in planes that are depreciated in a subsidy too business.
17- send their children to local libraries, pools & parks all funded by taxes.
18- eat food tested for purity and hygiene in preparation by the FDA and others.
19- take medicines tested for efficacy by the FDA.
20- hire any number of professionals- from Doctors, to Lawyers to Engineers that are licensed by the government to assure proper training and demonstrated competence.
The list goes on, and then they turn on Fox News Channel and hear someone bitch about how government does nothing right and how they do not benefit from their taxes.
C’mon DG. Your Fox News shot was not necessary. I could easily do the same with MSNBC and CNN.
That said, it took some work and time to put together a lengthy fine list of tax dollars benefiting citizens. I agree.
Where I don’t agree is the hapless politicians and bureaucrats playing games with tax rates and picking winners and losers with a tax code that could crush an elephant and needs a PH.D. to figure out by April 15.
But more importantly is how the money is SPENT and are citizens honestly getting the best bang for the buck. No, they are not!
One glaring example is the tax subsidies used by universities for esoteric studies that are meaningless to the average person and the Pentagon toilet costs, et al. Stupid waste of tax dollars is unacceptable.
Your list is wonderful and positive, but I believe you need to incorporate and evaluate the abuses, as well …
Most of these anti-taxers don’t have a number that would be low enough to make them happy with being taxed. They want to receive everything without paying for anything. If they don’t see how it’s paid for they think it must not cost anything or it is inefficient but if the garbage doesn’t get picked up they will be pissed. Also business are just as waistfull as the government without the accountability.
The numbers released today under President Trump are low enough for me. Taxes paying for services is a settled issue decades ago.
It’s not anti-tax, the issue is tax abuse, waste, fraud and knee jerk politicians that don’t consult the people, can’t cut waste (duplicate services) and raises taxes at will when they run into budget troubles.
“Also business are just as waistfull as the government without the accountability.”
No way, Jose! Business by definition is lean and mean to make profits, cover expenses and grow their business/profits. Totally unlike WASTEFUL SPENDING government that relies on an open spigot of tax dollars they can adjust higher at any time …
Whatever happens, as far as the personal tax rate is concerned, the middle class will end up getting screwed the most, and you can I’Cal that for sure.
While 35% is moderately high compared to what companies pay in other countries, you have to remember that given the various tax cuts and loop holes 100 of the largest companies in the US pay no federal taxes.
I find that to be most irksome. Small businesses bear the full burden of the tax code but large ones get the huge breaks. This is where Republicans talk the talk but so far have failed to walk the walk. A one page tax form … the dream what will likely never be.
This is the real problem– not that corporate taxes are too high, but that loopholes have made corporate taxation disappear altogether! Individuals and small businesses are shouldering the entire costs and governments run deficits but the Fortune 500 pay NOTHING!!!!!!
Bingo JWW and Sarah.
Here’s an idea.
Eliminate loopholes to require companies to pay taxes for the first time.
Then lower the rate that is fair and competitive with other countries.
Problem solved …
The GS alumni club, also known as the Trump cabinet, is salivating at the opportunity to sell fiscal idiots another dose of trickle down economics, which imagines that out of the goodness of their hearts the oligarchs will suddenly stop hoarding wealth if their tax rate was lowered. Hasn’t happened anywhere yet. Want proof, just look at Kansas.
The only way the USA will be an economic success for another couple centuries is if the accumulated debt is retired. That means FIRST lower spending and THEN lower income taxes.
If anything, sin, consumption, and pollution taxes should be raised in order to fund infrastructure renewal ASAP.
Obvious you are ignorant of history when Presidents JFK and Ronald Reagan cut taxes lead to massive economic growth …
Republicans: Ever the experts and blowing the US budget.
https://en.wikipedia.org/wiki/Starve_the_beast
Feed The Rich; Kill The Poor.
Democrats: Ever the experts at blowing the US budget
https://www.forbes.com/2009/09/17/federal-budget-spending-opinions-columnists-bruce-bartlett.html
Feed The Poor; Tell The Whining Rich To Shutup