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Zero Tax Is Normal For Many Corporations

WASHINGTON, Jan. 10 (UPI) — Nearly 70 percent of U.S. corporations were organized as non-taxable businesses as of 2008, IRS records show.

The percentage jumped significantly since 1986 when 24 percent of corporations used the “pass-through” tax structure, The Wall Street Journal reported Tuesday.

By 2008, 69 percent of businesses were set up to pass profits to shareholders to the point that it reduced their tax burden to zero. The law assumes that individuals will pay tax on the profits, rather than the corporations themselves.

But the growing popularity of a pass-through tax set up is why even some Republican legislators are calling for a tax system overhaul, the newspaper said.

It is also why tax revenues from corporations dropped to 1.3 percent of the gross domestic product, down from 2.7 percent in 2006 and from 6.1 percent in 1952, the Journal said.

UPI - United Press International, Inc.

Since 1907, United Press International (UPI) has been a leading provider of critical information to media outlets, businesses, governments and researchers worldwide.

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  • s c

    This extremely interesting stuff, people. Apparently, some Washington types (lobbyists?) managed to pull a good one on our elected geniuses.
    While we’re over-stocked on ‘soak the rich’ geekoids, it might be a good idea to CHANGE the tax laws so those “MANY” corporations won’t be able to dodge their responsibility and maintain a situation where it is ‘assumed that individuals will pay taxes on profits.’
    Would it be possible to make retrograde sterilization a requirement for those who made this situation possible? What was the point of creating this debacle? The stupidity never stops, folks. And our fearless leaders wonder WHY so many Americans are beyond being sick and tired of those we send to Washington. Insanity, thy name is WASHINGTON.

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