Okay, now we're on to part four of this ten-part series of the Trump
versus Harris tax battle. This one is,
this one's going to be related to bigger businesses,
typically, well, typically bigger businesses,
and it's the corporate tax rates. But remember,
there is a lot of planning opportunity. If you've watched some of the videos
I've done, like the Beemit blueprint or restructuring,
like creative tax planning and entity structuring,
there are times when you, like as an investor,
business owner, protecting your assets, you might want to have a C corporation.
This is a typical corporation. That most public companies are taxed this way.
Most big businesses are taxed this way. But you got to hear these proposals.
Like it's kind of insane. So on one hand,
so the Trump tax cuts, he brought the corporate tax rate from like a
28% rate down to 21% back in 2018.
Under the current proposals, Harris is proposing that we bring the corporate tax
rate back up to 28% instead of 21%.
And Trump is proposing,
well, like indirectly not proposing any different rate,
but I would assume he's going to be leaving. Giving it the same 21%,
but he's also proposing bringing back a domestic production activities tax credit,
which would bring the effective tax rate. If you're producing things in America,
it would bring the effective tax rate down to about 15%.
There wouldn't be forever all corporations, but forever for some,
could potentially be about, on average,
down to about 15%. So under Harris's plan,
it's a 28% corporate tax rate proposal.
Under Trump's, it could be, it'd be 21% down to about 15% if you're
producing things in America. So right now,
the, the, the, worldwide, this is from thetaxfoundation.org,
like, out of all countries, all corporations,
or all, you take all countries and look at all their corporate tax rates
and you take the average of it, it's about a 23% average.
So they're at, the average tax rate in the world is 23% for corporations.
Why, if we want to bring production,
we want to bring businesses to America, why would it be,
why would we want it 28%? Like, I,
I think the, I think 21% has made a lot of sense.
It's, on one hand, it's opened up a lot of opportunities for some strategic
tax planning, for people wanting to get some of the benefit of the C-corporations,
like, it just helped, helped it start to make sense for them.
These are even some small business owners, it's made sense for them.
Uh, usually high income small business owners. But the 28%,
other than, so if you think of production,
I want to be, uhm,
objective here and look at the pros and cons.
So if you think of, like, so the pros of a 28% tax rate
is potentially, like,
from the surface you might think that corporations are just going to end up
paying more tax. I don't think that's true.
I don't think that's how business owners, working with business owners for 20 years,
large and small business owners, they're accountants,
CFO, CEO, like they want, they need cash flow,
they need cash flow to, to introduce new products and new services and develop
new things, new products, and R&D and R&D and new plants and equipment and
all sorts of things and hiring. And if there's an,
an immediate 7% jump in their expenses,
they're going to look for some alternative strategies to get around that.
Maybe they would offshore, maybe they would start to,
uhm, produce things offshore.
Like, if they're not incentivized to do it here in America,
and then what happens there,
maybe we're losing some jobs, there's a negative impact on the economy.
I know there's a bit, like, there's a macroeconomic impact that no one can
foresee exactly on what would happen,
but, like, just from a business owner perspective.
if you have a 7% jump in your expense,
business owners are going to do something different, and if there's ways to do
something different, they're going to do it. So I would,
I would instead of, like, penalizing, it,
uh, the tax is in a way, in some ways, it's almost like a
penalty for doing well, but if you're if you have credits and incentives for
people to do things in America, I want to see more of that.
I want to see more of the incentives. And that's, I love viewing the
tax law more of like a book of incentives other than,
like, being penalized for doing something well, but I just,
I want the tax, that's how I want the tax code written.
So really that's, on the big businesses,
that's it. Let's see if there's like,
yeah, mostly just the corporate tax rates. There's some other things we'll cover in
those other, in those other series. But there is,
there is something that Harris had proposed.
It's related to this. It's a tax on companies buying
back their stock. So instead of,
and like a tax,
so if a company buys back its stock and brings the stock into its,
like its treasury stock, there would be a tax on that.
It would be increasing the tax on that.
And if you look at the government, when the government is proposing things and
implementing tax policies, they're kind of,
they're wanting to guide decisions in a way.
So this would be the government saying, hey, don't buy back your stock.
Do something else with your money. And so maybe,
maybe it promotes reinvestment into the company,
but that's, yeah,
that's after they're paying the 28% tax rate.
So that's the tax on the buybacks is something I,
yeah, definitely wanted to bring up too. Okay.
So that's the end of the part four of the 10 part series and
we'll bring you five more five through 10 here shortly as well.
