This is not news to anyone, and we are all aware of the dangers of a massive budget deficit.
Past News ReleasesRSS
New York, NY (PRWEB) December 21, 2012
Sasha Cekerevac, an editor and expert analyst with Lombardi Publishing Corporation, a 26-year-old consumer publisher that has served over one million customers in 141 countries, has responded to critics demanding America’s top income earners pay more tax to reduce the federal deficit. Cekerevac states that, with the budget deficit rising at an alarming rate, closing corporate tax loopholes would generate more income than further taxing an already stretched American public.
Cekerevac observes that America’s budget deficit has gotten too large and needs to be reined in. The problem is too much restraint in combating the budget deficit could slow economic growth.
The larger the budget deficit grows, the bigger the nation’s total outstanding debt. This can lead to massive financial problems over the long term, ultimately stifling economic growth, according to the Lombardi Publishing Corporation analyst.
Cekerevac notes: “This is not news to anyone, and we are all aware of the dangers of a massive budget deficit. The problem is that during periods of strong economic growth, politicians continue spending, when they should be paying down the budget deficit and debt accumulated during bad times. With the economy still weak, many are worried that economic growth can be hurt due to overly aggressive tactics in attempting to reduce the budget deficit.”
During the latest election, President Obama tried to deal with the debt issue by repeatedly stating that top income earners don’t pay enough in taxes. And that this is one of the main reasons why America’s budget deficit is so large, says Cekerevac.
The National Taxpayers Union recently looked at data from the Internal Revenue Service (IRS) and separated the incomes based on percentiles. According to the data, the top five percent of income earners—the threshold being $154,643—paid 58.6% of all federal personal income tax. (Source: National Taxpayers Union web site, last accessed December 15, 2012.)
According to Cekerevac, if a person makes more than $66,193, they’re in the top 25%, a group that, in total, paid 87.3% of all federal personal income tax. The question the analyst has now is…“how much more can we really expect an increase in taxes to help reduce the trillion-dollar budget deficit and not hurt economic growth?”
Conversely, there is growing evidence that many corporations are finding loopholes to reduce their tax bills. With America having one of the highest corporate tax rates in the world, it is natural for businesses to look at ways to minimize this cost. However, there is a difference between legally minimizing taxes and evading them, observes Cekerevac.
If America’s corporate tax rate was lowered and more in-line with other countries, corporations would not have to go to such great lengths to avoid paying taxes, says Cekerevac. This could be a two-fold benefit, according to the analyst, helping economic growth and lowering the budget deficit.
“If America didn’t have one of the highest corporate tax rates in the world, corporations would be able to repatriate the billions of dollars stashed overseas, in addition to eliminating future tax avoidance schemes. This would help increase and stimulate economic growth, which would increase government revenue, ultimately lowering the budget deficit,” said Cekerevac.
He concluded, “The world is quite small these days; money and businesses can shift locations very rapidly. America needs to understand that we are competing with every country around the world. By having corporate taxes so high, we are creating incentives for this kind of subterfuge.”
Founded in 1986, Lombardi Publishing Corporation, which has served over one million customers in 141 countries, is one of the largest consumer information publishers in the world. For more information on Lombardi Publishing Corporation, and to get its popular Investment Contrarians e-letter sent to you daily, visit http://www.investmentcontrarians.com. Or visit http://www.lombardipublishing.com/customer-service.html.