GOP presidential candidate Mitt Romney committed a huge political gaffe in Iowa by telling the audience that he believed that corporations were people and that if the audience didn’t like what he was saying that they didn’t have to vote for him. Corporations are currently taxed as though they are individuals, but does that make it right?
There is a lot of debate right now over “everyone paying their fair share”. I’m sure you’ve seen the YouTube videos of millionaires begging to be taxed along with articles ardently arguing that corporations should pay fewer taxes than individuals, capital gains taxes are not the same as earned income, and that if the economy is going to improve businesses need to be supported. Which side is right?
The answer is complex, but I believe both groups are right. Of course, every American should contribute to the overall well-being of our country however America runs on small businesses, so it’s important that small businesses aren’t taxed too much so they can grow. There is a fine line between paying an amount of tax that will support good roads, solid schools, and an able cadre of firepersons and paying an amount of tax that will cripple your business so you can’t afford to hire employees. Wouldn’t it be simpler to have a flat tax? Everyone would pay the same percentage of earned income, regardless of how they earned it, to help contribute to the betterment of our country.
There is no worse feeling than working hard to earn more money, be it from getting a promotion and new job title or building your business from the ground up, only to have your hard-earned money taken away while multi-million dollar corporations are paying less than you are. If everyone, including corporations, paid their “fair share” by contributing a portion of income to the government via a flat tax system we’d all be better off.
Shay Olivarria is the most dynamic financial education speaker working today and the author of three books on personal finance. Visit her at www.BiggerThanYourBlock.com.