Tuesday, April 08, 2008

Cut Business Taxes & Incentives

It's rather ironic, to say the least. Massachusetts is also facing budget woes. While considering lowering business tax rates, a recent report from Suffolk Univ. puts forth the idea that an overall lowering of that tax to the same rate as individuals would initially result in a large loss of government revenues. That, however, would be balanced by the elimination of various tax incentives- also known as tax breaks- and a simplfication of the tax code

"Closing loopholes and eliminating special tax breaks for particular industries or particular firms does, generally, improve a tax system by making it more economically efficient and fairer," said Noah Berger, executive director of the Massachusetts Budget and Policy Center, which analyzes how the state's tax policy affects low-income residents. (Boston Globe)

"We want to cut the corporate tax rate, but we think tax incentives are making it more difficult to do that because they are costing the state revenue," said David Tuerck, the institute's executive director and a Suffolk economist."

An original and novel idea. Cut all business taxes, simplify the code, and get rid of incentives. Instead of state's cutting each other's throats in a loosing proposition of ultimately cutting income, treat everyone alike. A level playing field. What an idea. Not just breaks for a few, but fairness for everyone- esp. our small businesses. If more state's adopted this strategy, we'd all be a lot better off. And with a simplified tax code to boot. Sounds like a plan to me. Also reminds me of some of the things the Poverty Institute has been recommending for quite awhile.
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