Who Pays the Corporate Income Tax?

Who Pays the Corporate Income Tax?

President Biden is proposing to finance his infrastructure spending proposal by increasing the corporate income tax rate from 21 percent to 28 percent. What difference will that make?

If there is one thing that virtually all economists are united about, it is this: corporations don’t pay the corporate income tax.

Why is that? A corporation is not a person. It is a relationship—a relationship between workers, managers, stockholders, consumers and others. You can tax relationships. But relationships don’t pay taxes.

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