Every year at tax time, as we all do our civic duty by submitting our federal, state and local taxes, we should all be thinking about the many multinational businesses that are not pulling their weight because they have successfully avoided paying corporate taxes.
The key to progressive taxation is placing the greatest obligation of a tax on those who can pay the most. Certainly we are facing huge pushback to this idea from the super rich and Wall Street.
The truth is, corporations are paying less and less of their share of taxes. In 2014, corporations paid taxes equal to less than two percent of the Gross Domestic Product (GDP). In 1950s the corporate share was double that, at more than 4 percent share of the GDP. Meanwhile, individuals’ tax payments in 2014 equaled more than 8 percent of the GDP — four times the corporate share for the same year.
Loopholes in our tax code, passed at the behest of the multinational corporations they benefit, have shifted the lion’s share of tax responsibilities onto American small businesses and average taxpayers. Studies show each small business in the U.S. pays an average of more than $3,200 in taxes to cover the cost of taxes avoided by multinational corporations.
Armies of lobbyists and tax lawyers have made Big Business complicit in shrinking our nation’s revenue stream, even as they take full advantage of government largesse. We must correct this systemic unfairness, which exacerbates the economic inequality that holds so many back from achieving the American Dream.