Sunday, May 16, 2021 | 2 a.m.
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There is a debate in Washington, D.C., about the effects of raising taxes on business owners to pay for President Joe Biden’s economic investment plans. It is the right thing to do.
Over 90% of all businesses are “pass through.” Meaning, the owners pay taxes on their profits as personal income. Any business owner making less than $400,000 per year won’t see any increase in taxes under Biden’s plan. For every dollar of profits over $400,000, those business owners have a choice: pocket the money and pay a slightly higher rate on those dollars; or reinvest those profits back into their business.
Corporations pay taxes on profits. Increasing taxes on corporate profits does not increase their costs. Higher taxes on corporate profits are not passed on to customers in the form of higher prices or to workers in the form of lower wages. Increasing taxes paid by corporations and wealthy business owners to be spent on infrastructure, education and health care goes into the pockets of workers who can then afford to buy more products and services, meaning business profits will go up, not down.
Republicans cut taxes on the wealthy three times since 1980. The result was “the giant sucking sound” of money and jobs going to Mexico, China and Asia. It is time to try something new.
