Job Creation Tax Plan

Employment grows slowly in the United States, and sometimes declines, even while American companies are making higher profits. While some growing companies invest their profits in domestic expansion and hiring more American workers, other companies are laying off American workers even while their profits are increasing. Why? Many profitable American corporations are shifting their payrolls offshore to take advantage of lower employment costs in other countries. They also...
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Employment grows slowly in the United States, and sometimes declines, even while American companies are making higher profits. While some growing companies invest their profits in domestic expansion and hiring more American workers, other companies are laying off American workers even while their profits are increasing. Why?

Many profitable American corporations are shifting their payrolls offshore to take advantage of lower employment costs in other countries. They also outsource their work to companies in other countries, enabling them to cut jobs in the United States to save money. For many corporations, there is no financial incentive not to layoff American workers.

Some companies choose to invest their profits in acquisitions, both foreign and domestic, save their profits, or simply pay out their profits to stockholders as dividends rather than use their profits to expand their operations by hiring new American employees.

What is needed is a new corporation income tax structure to replace existing rates that will reduce taxes for companies that are hiring more American workers year by year rather than laying them off. This will provide an incentive for profitable companies to invest their profits in hiring more American employees. It will also empower growing companies that are increasing their American payrolls year by year to grow faster, because it will enable them to retain and invest more of their profits in their own growth.

A new income tax rate structure that rewards domestic hiring can help stem the flow of jobs out of this country and begin to bring many jobs that have already been exported back to the United States. It can increase hiring and grow our economy at a faster rate. It can help provide the incentive for corporations to expand operations in the United States, and it can empower growing companies to expand their American operations at a faster rate.

And it can do this without reducing government revenue.

But how can this be done? What would such a tax rate structure look like? What issues need to be addressed? What will be the details?

This book explores how a new corporate income tax rate structure can help the economy and what the details of such a rate structure should be. It suggests a formula, based in increasing payroll, for a new income tax rate structure, and discusses issues such as, how new rates can be managed to provide the necessary incentives, yet prevent fraud and manipulation that would enable a company to reduce its tax rates without benefiting the economy. It discusses how such a rate structure would affect consulting companies and temporary help agencies. It addresses such questions as, how should employment be measured? Who counts as an American worker? How can government revenue be maintained?

This book can be a starting point for a public discussion of a new tax rate structure that will result in a faster growing and healthier American economy and full employment.