We all know that corporations are taxed based on their annual profit. Yet this profit can be endlessly manipulated using depreciation and a whole plethora of loopholes. As one who has been in the accounting profession for a few years, I have a modest proposal that could at one and the same time:
- Increase corporate taxes and
- Limit the pay of ravenous CEOs and other management
It’s really quite simple: No company can pay a tax that is lower than the amount of compensation (in cash or stock options) paid to its management. The management positions which trigger this tax policy can (and will) be negotiated endlessly, but the upshot will be higher corporate taxes and less outrageous sums going to overpaid CEOs and their henchmen.
Why should corporate rights be so much more generous than the rights of American workers?