It’s futile to rail against Burger King for planning to merge with the Tim Hortons chain and move to Canada. Tell the truth, wouldn’t you do the same kind of thing if you were a US corporation? After all, corporations pay 15 percent tax in Canada, while the US rate is 35 percent.
Of course, few, if any, US corporations pay anything like 35 percent. Their accountants have long ago figured out how to take advantage of the myriad loopholes in America’s labyrinthine tax code. Indeed, the big players, such as GE, pay no federal tax at all. And it’s not a new phenomenon. According to government records, two out of every three United States corporations paid no federal income taxes from 1998 through 2005.
Everybody agrees the US tax code must be rewritten. The President has been begging Congress to get on it.
But you know this Congress isn’t going to vote for anything the President suggests. The Republicans are sworn to oppose anything he tries to do, and they control the House. They also use the power of the filibuster to sabotage anything useful that shows up in the Senate.
Meanwhile, the nation’s corporations wriggle and dodge as best they can to avoid paying taxes. They’re doing a heck of a job, too. Back in 1955, corporate taxes accounted for nearly 28 percent of the federal government’s revenue. In 2010, the percentage was under 9 percent.
The loss of corporate revenue means Uncle Sam has to look to individuals – you and me – to make up the difference. Or cut services.With the Tea Party crowd controlling Congress, it isn’t hard to figure out which route the government will take. They would trash all federal programs if they could.
It’s one reason highways and bridges are in disrepair, schools are a shambles and cities are going bankrupt.
Burger King is not the only corporation fleeing America. Fourteen companies have already abandoned the US this year. And Walgreen’s was on the verge of moving to Switzerland until public pressure made company bosses back down.
Obviously, something must be done to stop the rot.
And obviously it’s up to Congress to do it. But this Congress won’t. So we voters have to get us a Congress that will. Just remember that in November.
In the meantime, boycotting Burger King is not the answer. Go ahead, enjoy your whopper. And have some Tim Hortons coffee with that. I hear from my Canadian relatives that it’s really good coffee (the doughnuts rock, too).
Click for more on corporate tax dodgers.
Click for more on the boycott idea.