Democrats believe corporations don’t pay enough taxes and are selling that idea right now on the campaign trail!

The U.S. corporation is the second highest taxed in the world. No wonder they are setting up home offices, registering their corporations, and setting up factories off shore.

Every large foreign competitor that U.S. corporations compete with pays only a consumption tax, a tax on the materials they use, in other words their profits are not taxed only the raw materials they buy. Their incentive isn’t taxed only the stuff they use. Local consumers pay a value added tax at the time of purchase for the stuff made in their country, but foreign consumers are exempted. While our corporations are mired in an outdated tax code that penalizes success, profits, and innovation our competitors have a huge advantage over us.

Bush and the Republican controlled Congress in Bush’s first term were not innovative enough to change the corporate tax code. There have been many advocates for tax code changes including Gov Huckabee, Newt Gingrich and other Republicans, but none have been successful in bringing about change in the tax code.

There is a great debate world wide on a way to tax corporations to level the playing field. All have agreed that taxing profits hurts the corporations, but this seems too complicated for our Washington politicians. They don’t even offer the debate to its citizens. The media seems reluctant to tackle the subject because it is either too boring or they would rather report that there are hundreds of major US corporations headquartered in a four story building in the Cayman Islands trying to beat the system.

Our clever Congress has not devised a way to tax profits made by U.S. Corporations in foreign countries unless the U.S. corporations bring the actual profits into the U.S. If corporations leave their profits off shore it’s not taxed. In fact, it’s illegal to tax such profits. It’s dead money. Do you know how many billions and billions American corporations are holding in profits off shore?

If Congress can somehow change the Corporate Tax Code American corporations would let the money enter the U.S. and spend it. This was quietly debated in Congress for a time and just as quietly shelved.

Can you imagine what that influx of American dollars would do for our economy? It would make Katrina bail out dollars look like pocket change.

Do you know how much better off America and American corporations would be if they could use those profits to build more of what they build and build it right here in the good old USA?