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alstry (35.42)

No Tax Revenues for NY

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August 12, 2008 – Comments (3)

Wall Street Losses Cut Tax Bill, Sap New York Revenue (Update2)

By Henry Goldman and David Mildenberg

Aug. 12 (Bloomberg) -- Wall Street's mortgage losses have grown so large that some firms may pay little or no taxes for years, widening New York City and state deficits and challenging their ability to provide services, Mayor Michael Bloomberg said.

``I think it will be a number of years before Wall Street starts paying taxes again,'' the mayor said at a press conference yesterday in Manhattan. ``They will carry forward all of those losses.''

Think about the effect on the above on not just city revenues, but state and federal tax receipts as well.  Then add in the negative revenue impact from job losses and lower wages/bonuses and clearly we are on the edge of a financial crisis many local budgets.

3 Comments – Post Your Own

#1) On August 12, 2008 at 8:46 AM, LordZ wrote:

Most companies in th US avoid paying taxes even before this meltdown http://biz.yahoo.com/ap/080812/corporations_income_tax.html

An outside tax expert, Chris Edwards of the libertarian Cato Institute in Washington, said increasing numbers of limited liability corporations and so-called "S" corporations pay taxes under individual tax codes.

"Half of all business income in the United States now ends up going through the individual tax code," Edwards said.

The GAO study did not investigate why corporations weren't paying federal income taxes.

More than 38,000 foreign corporations had no tax liability in 2005 and 1.2 million U.S. companies paid no income tax, the GAO said. Combined, the companies had $2.5 trillion in sales. About 25 percent of the U.S. corporations not paying corporate taxes were considered large corporations, meaning they had at least $250 million in assets or $50 million in receipts

My point is this is nothing new... however to increase tax revenues and to make our situation better we need to become more realistic with taxes, we need to lower taxes to a point where they are encouraged to report and recognize larger taxable profits.

Dorgan and Levin have complained about companies abusing transfer prices -- amounts charged on transactions between companies in a group, such as a parent and subsidiary. In some cases, multinational companies can manipulate transfer prices to shift income from higher to lower tax jurisdictions, cutting their tax liabilities. The GAO did not suggest which companies might be doing this.

"It's time for the big corporations to pay their fair share," Dorgan said.

Government Accountability Office: http://www.gao.gov

 

 

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#2) On August 12, 2008 at 12:26 PM, alstry (35.42) wrote:

"Most companies in th US avoid paying taxes even before this meltdown"

"My point is this is nothing new"

Your racism is only surpassed by your ingnorance.  No where in the article does it say MOST companies.  It says a large number of companies....but before this meltdown....corporations paid HUGE taxes.....just ask Mayor Blumberg.

Now those tax revenues are gone...gone for years....those were the taxes necessary to pay school teachers and  firefighters and police officers....not to mention retirement payments.

But not only are the corporate taxes gone...so are the individual taxes from those who have been fired and received huge paycuts...expecially in the financial services industry.

Basically, for the first time in history our state and local governments are bankrupt accross the nation at a time when they are most leveraged and their payment obligations are going to skyrocket due to the increasing number of people retiring.

The question Lordy is when will your government be willing to inform you of this little fact.  We know CA could fire all of its workers tomorrow and still not have enough money to meet its budget.

JP Morgan, UBS, and Fannie all told you things are getting a lot worse in July and August so far has deteriorated even further.

Our financial institutions are leveraged....as their assets evaporate soon they will not be able to pay back depositors.  Vinyard and Downy are two banks on the edge....five commercial credit unions wiped out all of their capital base with the last round of writedowns.

The FDIC has already depleted more dollars than the entire S&L crisis and only a few institutions have defaulted.  We are already talking about the fact that the FDIC will need more funding to meet its obligations and the defaults havn't even started.

At this point, our banking system is soooo leveraged that many of our banks are already insolvent and the information is being surpressed.

Over the next few weeks, expect to hear about a number of banks going under and the FDIC needs to raise more money to insure deposits. 

Will that create panic...probably not. 

Then expect to hear that local and state government will have to cut back services and lay off hundreds of thousands.....

Will that create panic....probably not.

Then expect a major conflict to erupt to distract the public for its economic woes and to convince people to make sacrifices they would never make in peace time....that is how panic will likely be avoided.

Lordy, that is simply the way it has happened for thousands of years when a country went broke and the bankers or goldsmiths stopped issuing credit.

 

 

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#3) On August 12, 2008 at 4:54 PM, LordZ wrote:

Alstry one of these days we really need to meet.

2 out of 3 Corporations did not pay any income taxes.

Many of those who did, have utilized legal means to minimize their taxes.

Your attacks are unwarranted and reveal what an ugly soul you have.

 

 

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