5 Giant Un-American Corporations Trying to Bolt U.S. to Avoid Taxes

Corporations get enormous benefits that regular “persons” do not. One of the biggest is limited liability. This means that the shareholders are not liable for the debts of the corporation. A corporation can get in a lot of trouble, financial and otherwise, and then just close up shop, divide its assets to its creditors, and the shareholders can just walk away losing only the money they originally put in. While it might be a “person” to certain members of the Supreme Court, there is no person to be made to work off the debt or to put in jail.

Corporations also enjoy lower tax rates than people do. (Except for the people who make a gain from the shares: they get a special, even lower tax rate called “capital gains.” Why is this? The capital gains tax rate is lower because the wealthiest make most of their income from capital gains, and the wealthiest make most of their income from capital gains because the capital gains tax rate is lower.)

And of course, corporate “persons” never have to die.

In return, we the people of the United States ask corporations to pitch in to help pay for the roads and courts and schools and scientific research and government contracts and the rest of the things that have helped make them the prosperous entities they are. But a number of American corporations are so fed up with the idea that should pay their taxes that they are actually renouncing their U.S. citizenship. These corporations are “leaving” the U.S. to dodge taxes — but their executives, employees, offices, stores, customers etc. are still here. The only thing that is really leaving the country is the requirement to pay U.S. taxes.

These corporations are able to “leave” the U.S. by engaging in something called inversion. Explaining an inversion is a bit complicated. A U.S. company buys or merges with a non-U.S. company, and the result is that the U.S. company can be considered to be a company from the other country. But at the same time the company keeps most of its operations, etc. inside the U.S. The result is that it might still owe taxes on income reported as made in the U.S., but it owes no taxes on income elsewhere.=

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