Business Tax

In today's economic crisis, the government needs to raise business tax, as it needs more money for social services, and to pay its snowballing national debt. The main groups that oppose this are certain economists, conservatives, Cato institute, the United States Chamber of Commerce, and Labour Unions.

    Currently, there are two main types of business tax: corporate income tax, and employment tax. The corporate income tax taxes corporations on their profit, according to their size. The employment tax is a tax on the employee's income, and both the company and the employee have to pay for it. It consists of Medicare, and Social Security. Generally, taxes are set to discourage certain investments, and tax reductions are an incentive to do a particular task.

    The government needs to raise business taxes to get more money for social services. In recent times, large multinational companies such as Lehman Brothers have declared bankruptcy, and as a result, unemployment rates have been soaring. Property prices have also plunged, leaving many retirees that invested in those properties with insufficient money. Given this situation, the government needs to spend more on social services, such as unemployment benefits. The government thus needs to increase the taxes, to ensure that it can continue to provide the social services.

    The government needs to raise business taxes to pay off its increasing national debt. The total debt of America now stands at a staggering 11.9 trillion, and the government does not have sufficient money to repay this massive debt. There is also a horrifying possibility that the countries lending America money, most notably China, would demand repayment. Slim as this chance may be, the government still needs to save up to repay the debts.

    Some economists and Labour unions oppose increasing taxes, especially employment taxes. Employment taxes increase the cost of hiring a worker, and companies would have to retrench more workers. The money needed to fund Medicare and Social Security can always come from other sectors, economists feel. Labour unions have witnessed the soaring unemployment rates, and would like to decrease the employment taxes too, so that more workers can be hired.

    The United States Chamber of Commerce opposes increasing business taxes. With less business tax, business can run better, and the owners of the companies will have more funds, and control.

    Conservatives and the Cato Institute oppose raising business taxes. Conservatives have historically opposed higher tax, as they view it as a punishment to the rich, and harmful for the economy. The Cato Institute is a libertarian group, which believes in maximizing individual rights, and is thus firmly opposed to all government taxes.

    In conclusion, there are many policies that the American government can explore that will benefit the economy in both the short run and the long run. Hopefully, the government can find a suitable solution to this crisis, and lead America back into economical prosperity.