Businesseurope

One necessary development in the federal tax system was the creation of the restricted legal responsibility corporation and the S corporation. LLCs and S companies provide businesses a variety of the advantages of incorporation, similar to limited liability, with out the overhead of changing into a standard C company. The income of these entities are taxed under the individual income tax code, which avoids the double taxation issues that plague the company revenue tax system. Proponents of gross receipts taxation invariably reward the steadier circulate of tax receipts into government coffers in comparison with the fluctuating revenue generated by corporate earnings taxes, but this stability comes at a fantastic cost. The attractively low statutory rates related to gross receipts taxes are an illusion. Since gross receipts taxes are levied many instances in the manufacturing process, the efficient tax rate on a product is far higher than the statutory rate …