I’m not serious , of course, but it is rather ironic that Raul Castro is cutting the tax burden on small business at the same time that Obama is pushing for higher tax rates on small business. Reuters reports on the latest in supply-side communism.
Cuba unveiled on Friday a new tax code it said was friendlier for small business, signaling authorities are serious about building a larger private sector within the state-dominated economy. The new system, outlined in the Communist Party daily Granma, greatly increases tax deductions… The tax redesign comes as the government has begun slashing 500,000 workers from state payrolls and preparing to issue 250,000 self-employment licenses to create new jobs in President Raul Castro’s biggest reform since taking office in 2008. …The new tax system enables the self-employed to deduct up to 40 percent from income for the cost of supplies, compared to just 10 percent under the old one. Formerly, small businesses simply paid a graduated income tax. Now they will also have to pay a 10 percent sales tax and 25 percent social security tax, but both are deductible at the end of the year.
Unfortunately, Obama seems to views tax issues through the prism of class warfare. This video explains why class warfare tax policy is misguided, and it includes the footage from the 2008 campaign where Obama basically said that he didn’t care whether his proposed tax increase on capital gains led to lower revenue.
The politics of hate-and-envy may be emotionally satisfying to some on the left, but there is strong evidence that high tax rates damage small business. And even though Obama apparently doesn’t think this means much, there is also lots of evidence that the so-called rich won’t wind up paying much additional tax because they can easily adjust their behavior. I guess the real question is why so many statists are consumed by disdain and resentment.
[…] a modest bit of economic liberalization (a point that I’ve also made, even to the point of joking about whether we should trade Obama for […]
[…] previously posted about the communist government of Cuba cutting taxes and the CEO of Coca-Cola saying that communist China has a more business-friendly climate than the […]
[…] previously posted about the communist government of Cuba cutting taxes and the CEO of Coca-Cola saying that communist China has a more business-friendly climate than the […]
[…] There’s actually much to like in the Administration’s potential plan. Lower tax rates will help the economy by improving incentives for productive behavior. And getting rid of distortions will further enhance growth since people no longer would have an incentive to make inefficient decisions just for tax purposes. And simplification could have a profound impact on cleaning up the horrible mess at the IRS. Moreover, a plan that trades lower tax rates for fewer tax distortions would be a welcome change from the poisonous soak-the-rich tax policy the White House has been pursuing. […]
[…] There’s actually much to like in the Administration’s potential plan. Lower tax rates will help the economy by improving incentives for productive behavior. And getting rid of distortions will further enhance growth since people no longer would have an incentive to make inefficient decisions just for tax purposes. And simplification could have a profound impact on cleaning up the horrible mess at the IRS. Moreover, a plan that trades lower tax rates for fewer tax distortions would be a welcome change from the poisonous soak-the-rich tax policy the White House has been pursuing. […]
[…] There’s actually much to like in the Administration’s potential plan. Lower tax rates will help the economy by improving incentives for productive behavior. And getting rid of distortions will further enhance growth since people no longer would have an incentive to make inefficient decisions just for tax purposes. And simplification could have a profound impact on cleaning up the horrible mess at the IRS. Moreover, a plan that trades lower tax rates for fewer tax distortions would be a welcome change from the poisonous soak-the-rich tax policy the White House has been pursuing. […]
I’d have to double-check the Helms-Burton Act to see if it specifically includes an embargo on the free trade of government bureaucrats.
But maybe y’all could get an exception on humanitarian grounds, (it’s inhumane for US citizens to live under Obama).