First, I'm going to tell you some things that will make you ill. Then I'm going to present a cure. It will make you feel better -- until, of course, you realize that knowing the cure brings us as close to implementing it as buying an electric guitar does to making you a rock star.
For all of its populist appeal, the corporate income tax is arbitrary and exempting some organizations from paying it is equally arbitrary. Abolishing the corporate tax altogether would supercharge the economy and wouldn't serve any particular set of political interests.
The RATE Coalition, a 501(c)4 organization dedicated to corporate tax reform, makes such patently simplistic arguments in this area that it's hard to fathom how two smart people like Elaine Kamarck and James Pinkerton could lend their reputations to the enterprise.
Let's put to bed for all time this trope that half of Americans have no "skin in the game." The income tax is simply one of a suite of federal taxes imposed on rich and poor in different proportions and collected through different mechanisms.
We all want to cut taxes. Globalization is nothing more than production looking for a cheaper country to produce. We can cut taxes by eliminating the corporate income tax and replacing it with a 5% value added tax.
The more you consume, the more you pay. Canceling the corporate income tax reduces the cost to all consumers. The 5% VAT is a winner for the poor, the middle-class, and the rich, and it is absolutely necessary in the trade war.