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The Student Newspaper of DePaul University

The DePaulia

The Student Newspaper of DePaul University

The DePaulia

The Student Newspaper of DePaul University

The DePaulia

Big business tax cuts add to small business struggles

As Americans start to buckle down and finish their tax returns to meet the deadline on April 18, they may be shocked to hear some entities are exempt.

A couple weeks ago, GE released reports of its earnings. The multinational corporation posted a worldwide profit of $14.2 billion in 2010, with five billion of its earnings coming from its U.S. operations. What do you think the company paid in taxes?

The answer is nothing — nothing at all — and this will mark the second year in a row GE has not paid any federal taxes on their income.

How does GE manage to get away with it? The answer is simple:  around-the-clock lobbying and an expert financial team. Armed with a team of highly skilled lawyers, the company has become adept at maneuvering through loopholes in their mission to avoid paying taxes.

Why is this a big deal? Well, small businesses pay their fair share of taxes, so there really is no valid reason why GE should be omitted. Additionally, taxing GE would help bring in money that would be beneficial for the country.

GE isn’t the only example of tax controversies in the U.S. Several months ago, President Barack Obama reversed his position on the Bush-era tax cuts, extending them in a highly criticized compromise with Republicans. Implementing these tax cuts for the rich will now cost us a substantial $700 billion over the next 10 years.

There is something fundamentally wrong with the government’s approach to the economy. There are no real measures being taken to avoid abuses, and the applied actions are nothing more than bandages on a gushing wound.

The most reasonable approach to fixing the tax crisis would be to implement a progressive tax system. This would tax everyone fairly based on his or her income, and it would ensure the money goes where it needs to go.

All the claims that taxing the rich too much would be detrimental fall flat. People in the middle class spend their money on things that help stimulate the economy, such as food or clothing. The wealthy, on the other hand, spend their money on self-serving investments or, even worse, they hoard it—which does nothing to help the economy in the slightest.

Those who have money should contribute back to their society. Not only is it fair, it’s also incredibly beneficial for everyone involved.

For the last couple decades, the middle class has been forced to act as the load-bearers for the wealthy. Until we start voting in politicians who have the backbones and resolve to enforce reasonable tax codes and curtail the rich’s excess, we’re going to continue to see more situations like this in the future.

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