Wednesday, November 9, 2011

Reasonable Tax Policy

I haven't updated here or on my facebook page for awhile now - life has been a bit nuts. I apologize. I plan on posting this in a lot of places today, because I had a semi-brilliant (or very dumb) idea this morning and I want to share it:

If tax cuts lead to job creation, as the Republicants say, why not officially tie the two together? Here’s the idea: your corporation gets a better tax break based upon the number of jobs created as a percentage of your total operating expenses or size of the company or percentage of your payroll. The higher the percentage, the lower your tax rate. If you are really creating jobs with these tax cuts, then the more jobs you create the better your tax rate will be.

This would be a great boon to small business as new hires as a percentage of their operation is a big deal, while a large corporation would need to hire more people to get the same break. Conversely, the reverse would also be true – if you shed jobs or ship them overseas then you would lose that tax break. There would need to be a corporate minimum so that mom and pop shops aren’t adversely affected when they run into financial straits and there would need to be some fine-tuning, but this policy would have the effect of putting your money where your mouth is. If you really are a job creator, then you would be rewarded. If you are a company that has maximized profits and shed employees in the process your tax rate would go up.

Obviously this is an overly-simplistic approach. There would need to be other factors incorporated into our tax policy for corporations, but this is designed to expose the lie about the Republicant claim that tax cuts create jobs. It should be the other way around – that job creation can create tax cuts.

This could be an effective and job-creating tax policy. Or else it would show the Republican tax policy for what it really is. I handle money for a living, and I know this.

I have two facebook pages, by the way. My friends page is and my Angry Accountant page is