One of the Left’s main complaints these days tends to be that corporations don’t pay their “fair-share” in taxes, possibly don’t pay any at all, and even worse, possibly end up with a net negative through subsidies. It’s a legitimate misconception, though. How often do employees - and employees make up the vast majority of the vocal voting base - get to see the behind-the-scenes in their employers revenue cycle?
The primary reason that this ends up being a bogus argument is relative to payroll. Employees see income taxes, federal, local, or otherwise, withheld from their checks. What most don’t get to see, though, is the fact that the employer has to match certain portions of those taxes. FICA taxes are paid not just by the employee. Employers have a contribution that they must meet. This is frequently a dollar for dollar matched amount.
For perspective on what that means: take into consideration how many employees some of the corporations that are frequently called out have. Amazon, Google, Walmart, etc. They have literally thousands of employees. Know the taxes that are ripped from their employees? The corporation is fronting that exact same amount for all employees. Each. And. Every. Employee. Even small businesses often pay nearly an employees yearly salary in payroll taxes each month.
Next, take a look at the various structures that corporations can maintain. Some of them are built so that the income the business makes is pass-through. That means it’s basically considered income for the owners/principles. On paper, this can frequently mean that the corporation itself “wasn’t taxed”, when indeed it paid a very hefty tax load through the owners/principles income taxes.
Think of this the next time someone complains about a corporation not paying taxes. It’s more complex than it seems, and it certainly amounts to a “fair share” in nearly every situation.
-Mike H
