If corporate taxes are reduced by 15 percent, lowering them from 35 percent to 20 percent, these companies could give a 5 percent raise to every worker. Why isn’t the private sector stepping up? If I was the head of a major corporation and my business taxes were reduced, I would give raises to thousands of my employees and take credit for it. It would be a public relations windfall. And it will cost only 1.5 percent to do if the average company has a 30 percent cost of labor.
How much more money will companies make in just the first year after a reduction in their taxes? It would be a windfall, and Congress could rightly expect companies to put that money to work by giving employees raises, hiring new workers and bringing businesses back to the U.S. Doing the right thing will help companies make more money.
About 45 million Americans are living below the poverty line. Government should do what it says it will do. Let’s incentive companies to hire somebody who is living in poverty or to hire somebody who is a military veteran. Maybe there could be a $10,000 tax credit for companies that show a net increase in this type of employee.
These are very simple things, and they don’t require a bill of 500 pages to get them accomplished.
Private companies should pledge to give a 5 percent raise to all workers if the corporate tax rate is reduced to 20 percent. This will help improve business without government taking credit.