My stimulus plan

Instead of printing up $1T or thereabouts and letting Government bureaucrats decide which companies live or die, I propose the following.

First item: Let's acknowledge that corporate taxes are a fraud. Corporations do not pay taxes. Rather, they remit so-called taxes that have been passed on, ultimately to consumers. Any tax the Government may levy on corporations will almost always be passed along to the consumer in one way or another. The corporation may simply directly pass along the cost by increasing prices and assuming taxes similarly affect all their competitors then this will be the easiest to accomplish. They may cut back on workers wages and benefits to offset the taxes. They may cut or eliminate dividends to shareholders. Most likely some combination of the three. And they may even pretend to eat some of the tax by paying for it by reducing profits (but I contend this is equivalent to cutting dividends).

Second item: business regularly seek to manipulate their operations to minimize taxes. They hire tax accountants and make business decisions based not on the soundness of the decision vis-a-vis how it benefits the business but on how the tax bottom line is impacted. On top of the actual corporate taxes paid, which were about $370B in 2007, corporations spend an additional $200B or more simply to comply with the tax code.

Third item: businesses regularly lobby for special exemptions and loopholes in the tax code. This leads to an overly complex tax code (and increased compliance costs) as well as the potential (and actuality!) for corruption in Government.

Fourth item: our federal corporate tax rate is one of the highest and most punative in the world, and is cited as a major reason for our multi-national corporations to move their headquarters overseas.

By now, my proposal should be obvious: eliminate corporate taxes.

The compliance costs go away...$200B+ freed up for more productive things.
$350B (+$200B compliance costs) or so goes right to the bottom line, which will lead to cheaper goods for consumers and/or higher wages or dividends to employees and shareholders--what'll that do for the economy?
Business decisions now will be based on sound busniess principles instead of tax impact.
Loopholes, etc. go away...all businesses now on level playing field.
"Corporate welfare", which almost always takes the form of tax credits, goes away.

But best of all, consumers will make the decisions, not bureaucrats.

Addendum: current estimates of uncollected taxes are estimated at $250B to $300B each year. So put the IRS people who would have been overseeing corporate tax collections to work recovering these revenues and the corporate taxes not collected are basically offset!