This is a very good Post to read, though one has to scale down through considerable Link garbage. The Author makes the overall Point that any effective Tax Change will alter the tax status by which small business relates to the C Corporations. Five of the Views described by the Author insist that small business will be forced into higher tax impact, while C Corporations will get lower tax rates. There is always the aside of double taxation which should not be stated, because it is actually taxation on two separate entities: the C Corporation and then its Stockholders. Both entities make a substantial Income, derived quite differently, and therefore subject to Taxation. The Solution to all these Problems can be accomplished simply, and I’ll try to explain How.
I will state initially that all Parties need to be subject to low steady rates of not just Tax, but of Tax Impact. It is also true that all C Corporations insist on all the Rights of an individual citizen in all legal disputes. My Solution is simply to eliminate all Corporate taxation and all Capital Gains taxation. Are Business personnel cheering at this Point? They should not be, because I must insist that all Income derived must be subject to the same rates required of individual Taxpayers. Here is where I begin to smile: All would get the Personal Exemption, get all the Investment advantages of 401k and other type Exemptions, and even get a Mortgage credit on one structure–limited in total amount of course. There would be absolute freedom from any discriminatory taxation based upon artificial device.
The next sensible function would be to eliminate the wide-open nature of current Exemptions, Tax Credits, and Reductions granted to any one Individual–whether human or C Corporation, S and Partnerships included. Congress should be prohibited from passing any Tax law which benefits any specific group, without outlining specifically what Value, or total amount, that this exemption could excuse from the Tax base of the Individual; I would be generous and suggest a one million dollar maximum to any tax reduction. I believe that resort and commitment to these two principles will do much to avert our deficit spending, and rescue our small business personnel from the ungodliness of Tax evasion. lgl