We will spend the rest of the week discussing these corporate tax reforms -----such as depreciation of LUXURY CARS and personal residential furnishing as a TAX BREAK -----
As we see below what is called a benefit to small businesses is really making official tax policy having been used these few decades of HIDING A CORPORATION'S real financial health with accounting methods.
TOP TIER STOCK OWNERS-----HAVING BEEN WINNERS THESE FEW DECADES BEING MADE A SMALLER GROUP when it comes to tax breaks.
When discussing corporate tax policy these few decades we have narrowed this discussion to what is described as TIERS------TOP TIER VS 2ND TIER for example. These 'TIERS' are tied to the global structure of product manufacturing where VAT tax structures remove TOP TIER global corporations from tax liabilities.
CORPORATE SUSTAINABILITY REQUIRES VERY CONSOLIDATED TIER 1 AND TIER TWO GLOBAL CORPORATIONS IN MANUFACTURING SUPPLY CHAIN.
'Accounting methods
Cash method of accounting: The act expanded the list of taxpayers that are eligible to use the cash method of accounting by allowing taxpayers that have average annual gross receipts of $25 million or less in the three prior tax years to use the cash method'.
'Limitations of Cash Accounting
A drawback of cash accounting is that it may not provide an accurate picture of liabilities that have been incurred but not yet paid for, so the business might appear to be better off than it really is'.
Below we see where global banking 1% tries hard to make a 25% ----or a 10% ---or a 5% of US citizens as shareholders feel they are still WINNERS as the rest of US citizens are pushed to being LOSERS-----these numbers don't add up because they are all FAKE DATA.
'The richest 5% of U.S. households owned about 2/3rds of all stock in 2010'.
'Over 75% of all U.S. stock is owned by households that earn more than $100,000 a year'.
'The Richest 10% of Americans Now Own 84% of All Stocks
money.com/money/5054009/stock-ownership-10-percent-richest'
Difference Between Tier 1 & Tier 2 Companies
by Olivia Durden; Reviewed by Michelle Seidel, B.Sc., LL.B., MBA; Updated January 31, 2019
Difference Between Tier 1 & Tier 2 Companies
1
What Is a Tier 1 Company?
2
What Is a Top Tier Organization?
3
Explain the Three-Tier Organizational Structure
4
"The Definitions of ""Upstream"" and ""Downstream"" in the Production Process"
In reference to business, the terms Tier 1 and Tier 2 usually refer to the manufacturing industry. The relationship between the original equipment manufacturer (OEM) and its tiers is crucial to the goal of creating, and in some cases, selling its products. There can be multiple tiers, and all are connected in a supply chain of command to the OEM – from the largest to the smallest number in the chain.
In other words, Tier 2 companies supply Tier 1 companies with the products needed. Every step of each company must go through rigorous quality assurance tests, as well as compliance with federal and company-based business standards.
Why the Supply Chain?
It is far more cost effective for several companies to specialize in making certain components than for one company to generate and market products end-to-end. With Tier 1 or Tier 2 companies zeroing in on one aspect, they can make sure to get the best experts and equipment for that job. Government regulations also exist that mandate using tiers – in the sense that each company is sanctioned for the product it produces and knows best how to adhere to federal or local regulations for it.
What Is Tier 2?
Tier 2 companies are the suppliers who, although no less vital to the supply chain, are usually limited in what they can produce. These companies are usually smaller and have less technical advantages than Tier 1 companies. If they are the first link in the supply chain, they start the ball rolling for the OEM’s final product, which means they really are vital to the speed of production. Tier 2 companies also must be rigorous in safety and standards compliance, because if something isn’t right, then it cannot go on to Tier 1.
What Is Tier 1?
Typically, Tier 1 companies offer the most advanced processes in the supply chain. This is the final step before the product reaches the OEM who may complete the product or simply get it ready for distribution by organizing shipment, marketing the products, or whatever is needed to get the product to the end user.
A Tier 1 company eliminates the middleman for the OEM. Such companies have the strongest credibility with the OEM, as they companies must have proven themselves to be a company that can generate reliable components on time and with strict adherence to safety and standards procedures.
An OEM may have many more tiers than this, but the relationship between Tier 1 and Tier 2 companies shows how all of them operate – Tier 2 generates and supplies Tier 1 with the products it needs to generate and supply the OEM with what is needed for the final products. The supply chain is only as strong as its weakest company link, so having healthy business practices is important for every tier to keep in operation.
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What are TWO-TIER CITIES?
In ONE WORLD ONE GOVERNANCE FOREIGN ECONOMIC ZONE structures we will see only global corporations as multi-national deemed FIRST TIER---OR TOP TIER-----and SECOND TIER-----in supplier and producer chain.
Here we see East India installing these same policies as too in US FOREIGN ECONOMIC ZONES.
We spoke the corruption of last century's economic terms like STEADY STATE and INFLATIONARY when neo-liberalism was installed. This week we want to shout out how terms like TIER 1 AND TIER 2 which have always indicated THE BEST of whatever measure-----TIER 1 SPORTS TEAMS are the BEST------TIER 1 AND 2 HEALTH INSURANCE PLANS are the BEST-------below we see a measure of cities called TIER 1 AND 2. None of this has anything to do with TIER 1 AND TIER 2 GLOBAL PRODUCERS AND SUPPLY CHAINS ----
Regarding STOCKS------derivatives have TRANCHES called TIER 1 AND LOWER------which make winners of stock owners in that highest tranche.
Remember, there is no US WALL STREET or US FED in MOVING FORWARD-----so, being stock holders in FOREIGN CORPORATIONS will soon be the only choice----and private stocks for corporate executives and boards will be those shareholders.
Today's US CORPORATE TAX REFORM reflects these changes -----
'Two-Tier Boards in Indian Corporations? An analysis ...
corporatelawreporter.com/2014/03/10/two-tier-boards...
However, with India opening up its borders to most multinational conglomerates, there could be a presumption that, over time, the Indian corporate scenario may witness a higher number of widely held corporations. Introduction of two-tier boards as an option for widely held companies could align regulatory foresight to this flux'.
Defining tiers is very subjective, as everybody will have qualifications as to what make a city an attractive global center. My rankings are primarily based on current state of the city and future outlook.
Tier I:
Chicago (One of the largest commodities trading hubs in the world)
New York (Global finance/equity hub)
Tier II:
Los Angeles (Really a Tier 1.5 in my opinion. The city has one of the most diverse economies in the world, but high cost of living and increased poverty rates are starting to take a toll on the city’s future potential with international investments)
Washington DC (Capital of most politically active country in the world)
Boston (Undisputed higher education hub in the world. It will take a long time for another city to catch up. Also huge finance center.)
Tier III:
San Francisco (Once the undisputed innovation hub in the world, exorbitantly high cost of living, along with global tech startups like Tel Aviv, Seattle, Shenzhen, Incheon, are starting to raise questions about the future growth potential at SF. High poverty too, though not at the level of LA.)
Miami (Underrated, IMO. Many Latin American companies are setting exchanges in South Florida to escape instability back home. Miami is likely the largest financial center in the Southern USA too, along with Charlotte.)
Seattle
Philadelphia
Dallas
Houston
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Cities are deemed TIER 1 or TIER 2 by population density-----by tourism------by kinds/size of industry. The United Nations/World Bank claim TIER 1 AND TIER 2 cities are tied to GREEN CORPORATE SUSTAINABILITY--------
The point we are making is this: national FAKE NEWS media and global corporations are deliberately CORRUPTING and CONFUSING these terms. What is TIER 1 AND TIER 2 can KILL 99% OF WE THE PEOPLE or it can be SOCIAL BENEFIT.
MOVING FORWARD ONE WORLD for only the global 1%-----has no SOCIAL BENEFIT----so talk of TIER 1 AND TIER TWO cities will never end well for the general population. We discuss often how UN and World Bank/World Health Organization have their eyes on mass depopulation and FINAL SOLUTION DEEP DEEP REALLY DEEP STATE---so, no social benefit tied to label of TIER 1 AND TIER 2 ranking of cities.
Below we see reference to PRODUCER/SUPPLIER CHAIN which is designated TIER 1 AND TIER 2. TIER 1 refers to PRODUCERS----TIER 2 refers to SUPPLIERS.
We ask our 99% of WE THE PEOPLE----think of this. Last century all US corporations went overseas to Asian FOREIGN ECONOMIC ZONES where producers and suppliers were HALF-A-WORLD AWAY. Shipping all that mass consumption product around the world WAS NOT SUSTAINABLE ---WAS NOT GREEN. What is ONE WORLD ONE GOVERNANCE creating with these SUSTAINABLE PRODUCER SUPPLIER CHAINS? The exact same thing except they are FLIPPING from manufacturing being located in Asia to manufacturing located in Western hemisphere---US/Canada/Latin America/Western Europe/Africa. EXPORT ONLY MANUFACTURING of products to be shipped to EASTERN HEMISPHERE.
MNCs ---multi-national corporations are no longer US OR AMERICAN------what is TIER 1 AND TIER 2 producer supplier being built in US FOREIGN ECONOMIC ZONES?
DARK AGES EAST INDIA CORPORATION------COLONIALISM
MNCs eye tier-2 cities for engg R&D centres
Sangeetha Chengappa
Bengaluru | Updated on March 18, 2019 Published on March 18, 2019
Low attrition rates, growing ecosystem of tech start-ups and support from State governments are also factors that attract MNCs to tier-2 cities
Talent availability, cost arbitrage are main attractions
Global in-house centres (GICs) of multinational corporations in India are looking beyond the top six cities to tier-2 locations to expand their engineering R&D operations.
Cities such as Ahmedabad, Vadodara, Coimbatore, Kolkata, Chandigarh, Thiruvanantha-puram, Kochi and Visakhapatnam are the new favourites.
Attractive features
Increasing availability of talent, cost arbitrage, low attrition rates, growing ecosystem of tech start-ups and support from State governments are factors that have contributed to making these tier-2 cities attractive to GICs.
Automation Anywhere, one of the top five global leaders in RPA (robotic process automation) for enterprises, which has engineering R&D centres in San Jose, Bengaluru and Vadodara, is expanding its presence in Vadodara.
“Our Vadodara centre is very important. We have teams involved in product engineering and innovation, customer success and global field support in the centre. Since Vadodara is a big university town, we are able to attract some of the best talent to work with us. Talent from the centre is currently being deployed across 15 locations globally, including the US, Australia, Singapore, West Asia, Japan, France and the UK, and we will continue to expand our operations here,” Milan Sheth, Executive Vice-President - IMEA, Automation Anywhere told BusinessLine.
Until 2018, all on-boarding of the company’s new employees was done out of Vadodara, which houses 400 of the company’s 1,000-strong R&D talent in India.
Nissan centre in KeralaNissan Motor Company Ltd signed an MoU with the Kerala government to set up its first global centre for digital operations last year in Thiruvanthapuram, which now has a team of 500 engineers. The company already has a global alliance R&D centre in Chennai, which employs 7,000 engineers, who are working on projects, including vehicle and technology development.
As per estimates by global management consulting firm Zinnov, there are 976 multinational corporations which have set up 1,257 GICs in India, of which 68 GICs are in tier-2 locations. Vadodara (29 per cent) and Ahmedabad (20 per cent) together account for 49 per cent of installed GIC talent in tier-2 cities. Bengaluru continues to command pole position for engineering R&D GICs with 469 centres followed by NCR (181), Pune (172), Hyderabad (153), Mumbai (125) and Chennai (117).
Vadodara is key city
Pointing out that Vadodara has emerged as a key tier-2 city for MNCs to establish R&D centres in verticals such as Industrial, Chemicals, Software & Internet, Anand Subramaniam, Associate Director, Zinnov said, “Automation Anywhere has its largest ER&D centre, global water technology firm Xylem, which is building innovative technology-first products for clean water and smart cities, and Solvay, which is working on developing new speciality chemicals for various industries, are all located in Vadodara.”
“Kolkata is shedding its image of a non-starter, attracting R&D centres in the software vertical. For instance, Lexmark is working on embedded solutions in printing and imaging products for its global clients and Hyland is building new age enterprise content management/process management suites. Coimbatore is gaining prominence in Tier 2 cities for multiple industry verticals due to low cost of operations and increased ease of doing business. Mobius which provides professional services for e-commerce, travel, real estate clients and Cameron which works on engineering design for oil & gas, energy industries are located in Coimbatore,” Anand added.
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Yet another measure of TIER 1 AND TIER 2 CITIES is the 24/7 operations of business infrastructure. In FOREIGN ECONOMIC ZONES overseas global factories and campuses were operating 24/7------global phone centers et al operating 24/7-----so, when we hear in Baltimore the city needs more 24/7 business structure----that is what it means.
Here we POPULATION DENSITY as a measure of TIER 1 AND TIER 2 CITIES. The goal of global banking 1% is to push almost all of the world's population into these mega-cities deemed SMART CITIES ---deemed TIER 1 AND TIER 2 CITIES.
'by 2050 some 70% of a projected population of nine billion will reside in cities and their suburbs. Hence, city dwellers will increase from 3.5 billion to 6.3 billion, an 80% rise in urban population'.
So, since this is the ABSOLUTELY WORST structure for economic and development strategies in WORLD HISTORY, global banking creates FAKE NEWS FAKE DATA and far-right wing global banking TALKING POINTS pretending to be left social benefit------selling these massive structures as GREEN AND ENVIRONMENTAL----as populist and full of democracy and freedom------when of course these high-density SMART CITIES will be STANFORD TOTAL PRISON MODEL ---------where everyone is 'HIT' -----SURVEILLED everywhere 24/7 ----inside residential and outside public-----you know, just like ME AND MY CASE of being HIT inside my living space.
'Hong Kong introduces two tiered profits tax rate marking a push towards a more competitive tax environment
3 January 2018
Hong Kong Tax Alert - Issue 1, January 2018'
So, we will now bring the discussion of TAX PUBLIC POLICY tied to terms like TIER 1 AND TIER 2 cities to TAXES----below we see HONG KONG---raging global neo-liberal city in a massive MARXIST CHINA.
Notice this article uses TWO TIERED PROFITS TAX RATE.......which without coincidence is where US CONGRESS and TRUMP are taking US CORPORATE TAX REFORM.
America’s Top Tier Cities: How Real Estate Investment Seeks Urban Quality in its Choices
February 27, 2017/in Academics, Board of Regents /by REALTOR® University
This article was written by Hugh F. Kelly, PhD, CRE.
He is the author of 24-Hour Cities: Real Investment Performance, Not Just Promises and a current member of the REALTOR® University Board of Regents.
The world stands at an extraordinary point. For the first time in the history of humankind, the majority of people live in urban areas. That’s 3.5 billion of the seven billion population of the planet. Even more exceptional, by 2050 some 70% of a projected population of nine billion will reside in cities and their suburbs. Hence, city dwellers will increase from 3.5 billion to 6.3 billion, an 80% rise in urban population. That’s a huge challenge, but it is also a great opportunity for development and investment around the world.
During the past two centuries, the United States has led the way in using migration and immigration to create great cities. At the beginning of the 20th century, America’s population was still largely rural despite the advances of the industrial revolution in employing workers in plants and factories that centered on the cities of the Northeastern quadrant of the country. Cities such as New York, Boston, Washington, Miami…. and even West Coast centers like Los Angeles and San Francisco…. fell prey to violence and civil disorder in the Sixties, Seventies, and into the Eighties. Some places still struggle: Detroit, St. Louis, Cleveland, Birmingham among them. But evidence has accumulated that we are in a new and favorable era for urban America.
Research has been accumulating that indicates several observable urban characteristics which combine to indicate successful cities. This research began with the investigations that led to the publication of my book, 24-Hour Cities: Real Investment Performance, Not Just Promises (Routledge, 2016). Studies have continued in collaboration with Dr. Emil Malizia of the University of North Carolina/Chapel Hill, who independently pursued the topic of “vibrant cities” from an urban planning perspective. Our studies are examining a taxonomy of American cities, a grouping together of cities with common characteristics that point toward economic and social success, characteristics that have supported superior real estate investment performance over nearly three decades now.
Those attributes include diurnal activity (measured by the number of drugstores in 24/7 operation), population density (more than 9,000 per square mile), low crime (fewer than 5,000 FBI Index Crimes per 100,000 residents), transportation (a minimum 10% of the workforce using public transit), live/work proximity (at least 30% of workers living within one mile of downtown), and high Walk Scores. Cities that rank at the top of four of the six criteria are Tier One cities, and are popularly termed “24-hour cities.” Those that meet three of the criteria are clustered as Tier Two cities, matching a grouping termed “18-hour cities” in the industry survey Emerging Trends in Real Estate.
Studying 42 cities in detail, we find six Tier One cities at present:
New York, Chicago, San Francisco, Philadelphia, Boston, and Washington DC.
Eight cities qualify as Tier Two:
Seattle, Los Angeles, Oakland, Portland OR, Baltimore, Pittsburgh, Minneapolis, Austin, and Miami.
Tier One cities have demonstrably produced superior investment returns, as measured by the NCREIF Property Index (NCREIF is the National Council for Real Estate Investment Fiduciaries) for office assets, and this has made such cities magnets of investment capital. Since 1987, Tier One cities have seen their office markets grow from a 16.3% share of total NCREIF investment in 1987 to a 20.1% share, or $101.4 billion as of mid-2016. Tier Two cities have held a fairly steady share of the NCREIF total, at 6.8% in 1987 to 7.2% ($36.5 billion) in 2016. Tier Three (the other 28 cities) have seen their share fall from 13.3% in 1987 to just 6.6% ($33.5 billion) in 2016.
Apartment investment is more evenly distributed as of 2016, but the trends for the three tiers are distinct. The institutional investors comprising NCREIF’s data contributing membership were late in coming to the multifamily sector, but have been making up for lost time in the past two decades. Tier One apartment markets accounted for just 2.0% of the NCREIF portfolio in 1997, but this jumped to 7.4% ($37.2 billion) in 2016. Tier Two multifamily markets represented 2.1% of total in 1997 and 5.5% ($27.9 billion) in 2016. Tier Three apartment assets stood at 7.1% of total in 1997, and were just slightly higher at 7.8% ($39.2 billion) in 2016.
The increasing share of total investment being captured by Tier One and Tier Two markets arguable forms a potential virtuous circle for 24-hour and 18-hour cities. Their status as capital magnets not only provides superior property appreciation, but it encourages continued investment in the assets in the form of CapEx (capital expenditures) to keep the assets competitive and attractive to businesses and to workers. It also provides municipalities with a strong and durable commercial real estate tax base. If such cities wisely reinvest those taxes in high quality public services and amenities, that further attracts high quality workers and the firms that can put those workers to the most productive use.
This is not to say that top tier cities cannot have problems. I would argue that such cities turn problems to advantage. Problem-free cities are not forced to innovate. Innovation comes from problem solving. More is still to be learned. But as the U.S. grows through 2050, so will its cities. And America’s ability to craft ever more attractive live-work-play environments in its cities is one way in which our nation can lead in an increasingly urbanized world.
____________________________________________
Hong Kong is simply installing ONE WORLD ONE GOVERNANCE FOREIGN ECONOMIC ZONE policies tied to global corporations identified as PRODUCERS AND SUPPLIERS. There will be no small and regional businesses deemed TIER 1 OR TIER 2. The tax structure being installed here in HONG KONG as by US Congress and Trump is one where TIER 1 AND TIER 2 global corporations pay NO TAXES----or VERY LITTLE TAXES---while small and regional businesses pay GREAT BIG TAXES. The big LOSERS are the CONSUMERS at the bottom of this CHAIN----those would be our 99% of WE THE PEOPLE.
We have discussed the VAT TAX--------this is simply a variation of this VAT TAX structure.
Notice how HONG KONG global 1% sell this idea of CORPORATE TAX REFORM to small and regional businesses as GOOD FOR THEM.
'KPMG observations
As global tax rates continue to fall, Hong Kong has to introduce new tax measures in order to remain competitive and attract foreign investment into Hong Kong.
The Profits Tax bill is a welcome enhancement to small and medium enterprises in Hong Kong and to the Hong Kong tax system to maintain its position as Asia’s leading international business centre.The Profits Tax bill will be formally introduced into the Legislative Council on 10 January 2018. The IRO will be amended in order to introduce the two-tiered profits tax rate regime. KPMG will provide further commentary and insights upon the release of such amendment to the IRO.
For more information and assistance, please contact your usual tax advisor or one of our tax advisors'.
Please Google to see charts ----
The United States’ Corporate Income Tax Rate is Now More in Line with Those Levied by Other Major Nations
February 12, 2018
Kyle Pomerleau
The Tax Cuts and Jobs Act (TCJA) reduced the U.S. federal corporate income tax rate from 35 percent to 21 percent. However, corporations operating in the United States face another layer of corporate income tax levied by states. As such, the statutory corporate income tax rate in the United States, including an average of state corporate income taxes, is 25.7 percent. This rate puts the United States in line with the average among Organisation for Economic Co-operation and Development (OECD) member nations.
In addition to the 21 percent federal corporate income tax rate, 44 of the 50 U.S. states levy corporate income taxes. State corporate tax rates range from 3 percent in North Carolina to 12 percent in Iowa. The average state corporate income tax rate (weighted by population) is 6 percent. (See Table 1, below)
Under current law, state and local income taxes are fully deductible for corporations. As such, the effective statutory tax rate for each state is lower than the “headline” tax rate. Four states (Alabama, Iowa, Louisiana, and Missouri) also allow corporations to deduct some portion of their federal tax liability against their state liability, reducing the effective statutory rate even further.
Combined with the federal rate of 21 percent, corporations face marginal rates from 21 percent in states with no corporate income tax to as high as 29.6 percent in Iowa, where the corporate tax rate is 12 percent. The weighted average (by population) combined corporate income tax rate in the United States under current law is 25.7 percent.
Before the TCJA passed, the United States had the highest combined statutory corporate income tax rate among the OECD nations at 38.9 percent (35 percent plus the average of state corporate income tax rates). This was approximately 15 percentage points higher than the OECD average, excluding the United States at 23.8 percent (26.5 percent weighted by GDP). (Figure 1)
After the passage of TCJA, the U.S. combined rate dropped from 38.9 percent to 25.7 percent. This puts the United States slightly above the OECD average of 24 percent, but slightly below the average weighted by GDP.
The TCJA significantly reduced the federal statutory corporate income tax rate. When combined with state and local taxes, it put the U.S.’s corporate tax rate in line with the average among OECD nations.
_________________________________________
When discussing global corporations in FOREIGN ECONOMIC ZONES and the goals of ONE WORLD ONE GLOBAL TIER 1 AND TIER 2 producer supplier chain-----please remember yet another confusing set of terms. Where TIER 2 SUPPLIERS will be global corporations------this category is divided into many other TIERS----all of which are called SUBCONTRACTORS. SUBCONTRACTORS are those small and regional businesses being told all this VAT TAX structure MOVING FORWARD is GOOD FOR THEM.
TIER 2 SUPPLIER GLOBAL CORPORATIONS will have a long list of tiers tied to being subcontractors to top supplier global corporations.
'A Tier 1 company eliminates the middleman for the OEM'.
'Difference Between Tier 1 & Tier 2 Companies
by Olivia Durden; Reviewed by Michelle Seidel, B.Sc., LL.B., MBA; Updated January 31, 2019
Difference Between Tier 1 & Tier 2 Companies'
Could a two tier VAT system save the high street?
13th Sep 2018
27
The high street’s troubles are well documented at this point. Stores have closed, jobs have been lost and businesses have gone bust, the decline seems terminal. But according to one group, a two-tier tax system could stop the bleeding.
Colliers International, one of the UK's largest property consultancies wants a two tier VAT system. Under the proposal, shoppers would pay tax at 15% in a brick-and-mortar store and 22.5 % for online purchases.
The suggestion isn’t entirely from left field. The chancellor Philip Hammond recently told Sky News he’s considering a special retail tax - dubbed an ‘Amazon tax’ - on online retailers.
"We want to ensure that taxation is fair between businesses doing business the traditional way and those doing business online," he said in the Sky News interview. "That requires us to renegotiate international tax treaties because many of the big online businesses are international companies.”
Adapting the VAT system could be a powerful vehicle to achieve this, according to Paul Souber, Colliers’ head of London retail. It would present a strong incentive for shoppers to return to the high street and online retailers to lease physical stores.
But Souber and Colliers’ plan isn’t as simple as it sounds, according to David Wilson and Andrew Hubbard of RSM. “Artificial distinctions to address a particular policy agenda generally don’t work,” they wrote.
“The very ethos of VAT is that it is charged on the ‘value added’ at each stage of the production and distribution process, including retail sale, and affords businesses in the supply chain the right to deduct the VAT paid at an earlier stage of that process from the VAT payable on the onward supply.”
VAT is structured, ultimately, to be paid by the end consumer. “If a higher VAT rate applies to online retail sales than to sales by high street retailers then, rather than levelling the playing field between the two, the additional VAT burden would result in increased costs for the consumer.
“As VAT would not appear to be either a legally competent or administratively practicable means of levelling the playing field between the high street and online retailers, and as it's highly unlikely that the Chancellor will interfere with the business rates regime, the focus will once again fall on taxing the value generated by online businesses.
“Whether that will take the form of an online sales tax should become clear on Budget day.”
As we’ve covered on AccountingWEB before, simply blaming online retail for the high street’s woes is simplistic. Inertia and a failure to address the drag of legacy real estate has created its share of the trouble, too. To paraphrase, the retail analyst Richard Hyman: an ‘Amazon Tax’ might dull the pain - but will it create better retailers?
_______________________________________
BUT BILL GATES supports these US CORPORATE TAX REFORMS tied to installing VAT globally---and BILL IS THAT GOOD BILLIONAIRE remember-----he cares about our US 99% of WE THE PEOPLE ----wait, he is DEEP, DEEP REALLY DEEP STATE----we are sure BILL only cares about BILL.
PROGRESSIVE used here is FAR-RIGHT WING GLOBAL BANKING 1% ECONOMIC PROGRESSIVE---NEO-LIBERAL consumption tax-----the opposite of REAL left social progressive FDR broad-based tax contribution from corporations and the rich.
Mar 18, 2014, 01:14pm
Bill Gates Points To The Best Tax System, The Progressive Consumption Tax
Tim Worstall
Contributor
I think tax structures will have to move away from taxing payroll. … Technology in general will make capital more attractive than labor over time. Software substitution — whether it’s for drivers or waiters, nurses … it’s progressing. And that’s going to force us to rethink how these tax structures work in order to maximize employment given that capitalism in general over time will create more inequality, and technology over time will reduce demand for jobs, particularly at the lower end of the skill set. We have to adjust, and these things are coming fast. Twenty years from now, labor demand for lots of skill sets will be substantially lower, and I don’t think people have that in their mental model. … Economists would have said a progressive consumption tax is a better construct at any point in history. But what I am saying is that it’s even more important as we go forward because … I want to distort in the favor of labor. …When people say we should raise the minimum wage — I know some economists disagree — but I worry about what that does to job creation. The idea that through the Earned Income Tax Credit you would end up with a certain minimum wage that you would receive, that I understand better than intentionally dampening demand in the part of the labor spectrum that I’m most worried about.
There's two parts to why such a progressive consumption tax is regarded so highly by economists. The first part speaks to efficiency, the second to equity.
To deal with the second idea first: despite many thinking that economists are simply the handmaidens of the oppressor class of the 1% "what's fair?" is a question that is asked rather a lot in the halls of academe. And the general answer is that fairness in a taxation system requires that those with the greatest capacity to pay should pay more tax than those with a lesser capacity to pay. This is accepted by pretty much everyone: that average tax rates should rise with income. Sure, some to many go on and insist that the rich should pay much more than this, face rising marginal rates perhaps, but the original contention is supported by pretty much everyone. And that's where the "progressive" part comes in. It doesn't mean that there has to be a number of different tax rates: that would be insisting that there must be higher marginal rates. All you need to have rising average tax rates is that there is a flat tax with some non-taxable allowance at the bottom of it.
Just as a constructed illustration of this, take a tax system with a 10% rate on all income over $10,000 a year, the first $10,000 being tax free. If you make $10,00, your tax rate is 0%. If you make $20,000 then your tax bill is $1,000 ($20k - $10k x 10%) or 5% and if $100,000 then your tax bill is $9,000 ($100k-$10k x 10%) or 9%. We have rising average tax rates even if we don't have a rising marginal one. Indeed, the average tax rate will asymptotically approach the flat tax rate itself as income rises. As above, you can also have rising marginal rates or tax bands if you desire, but this flat tax with an allowance is indeed enough to meet the condition of it being a progressive tax system.
The second part is about efficiency, which is that part that means that we tax consumption. Here the concern is about deadweight costs. All and any tax, by being levied, means that some economic activity doesn't happen. But we do need to raise some taxes, somewhere, for we do rather need this thing called government and we've got to pay for it. Maybe we don't need as much as we have, perhaps we need more, but the basic fact that there have to be taxes of some kind remains. We would obviously therefore prefer to raise the tax money we need by using the taxes that have the least deadweight costs. All other things being equal we'll be richer by doing it this way rather than using taxes which destroy more economic activity for the same amount of revenue collected.
We know which taxes destroy the least economic activity as well. Repeated taxes on real property can actually create more economic activity in certain circumstances. Then more costly are consumption taxes, more costly again are taxes upon incomes and then most costly are capital and corporate taxes. Transactions taxes like the financial transactions tax are so ludicrously expensive in this sense that we don't usually include them in our list: but they're way up at the top there, even more damaging than capital or corporate taxes.
As we see below what is called a benefit to small businesses is really making official tax policy having been used these few decades of HIDING A CORPORATION'S real financial health with accounting methods.
TOP TIER STOCK OWNERS-----HAVING BEEN WINNERS THESE FEW DECADES BEING MADE A SMALLER GROUP when it comes to tax breaks.
When discussing corporate tax policy these few decades we have narrowed this discussion to what is described as TIERS------TOP TIER VS 2ND TIER for example. These 'TIERS' are tied to the global structure of product manufacturing where VAT tax structures remove TOP TIER global corporations from tax liabilities.
CORPORATE SUSTAINABILITY REQUIRES VERY CONSOLIDATED TIER 1 AND TIER TWO GLOBAL CORPORATIONS IN MANUFACTURING SUPPLY CHAIN.
'Accounting methods
Cash method of accounting: The act expanded the list of taxpayers that are eligible to use the cash method of accounting by allowing taxpayers that have average annual gross receipts of $25 million or less in the three prior tax years to use the cash method'.
'Limitations of Cash Accounting
A drawback of cash accounting is that it may not provide an accurate picture of liabilities that have been incurred but not yet paid for, so the business might appear to be better off than it really is'.
Below we see where global banking 1% tries hard to make a 25% ----or a 10% ---or a 5% of US citizens as shareholders feel they are still WINNERS as the rest of US citizens are pushed to being LOSERS-----these numbers don't add up because they are all FAKE DATA.
'The richest 5% of U.S. households owned about 2/3rds of all stock in 2010'.
'Over 75% of all U.S. stock is owned by households that earn more than $100,000 a year'.
'The Richest 10% of Americans Now Own 84% of All Stocks
money.com/money/5054009/stock-ownership-10-percent-richest'
Difference Between Tier 1 & Tier 2 Companies
by Olivia Durden; Reviewed by Michelle Seidel, B.Sc., LL.B., MBA; Updated January 31, 2019
Difference Between Tier 1 & Tier 2 Companies
1
What Is a Tier 1 Company?
2
What Is a Top Tier Organization?
3
Explain the Three-Tier Organizational Structure
4
"The Definitions of ""Upstream"" and ""Downstream"" in the Production Process"
In reference to business, the terms Tier 1 and Tier 2 usually refer to the manufacturing industry. The relationship between the original equipment manufacturer (OEM) and its tiers is crucial to the goal of creating, and in some cases, selling its products. There can be multiple tiers, and all are connected in a supply chain of command to the OEM – from the largest to the smallest number in the chain.
In other words, Tier 2 companies supply Tier 1 companies with the products needed. Every step of each company must go through rigorous quality assurance tests, as well as compliance with federal and company-based business standards.
Why the Supply Chain?
It is far more cost effective for several companies to specialize in making certain components than for one company to generate and market products end-to-end. With Tier 1 or Tier 2 companies zeroing in on one aspect, they can make sure to get the best experts and equipment for that job. Government regulations also exist that mandate using tiers – in the sense that each company is sanctioned for the product it produces and knows best how to adhere to federal or local regulations for it.
What Is Tier 2?
Tier 2 companies are the suppliers who, although no less vital to the supply chain, are usually limited in what they can produce. These companies are usually smaller and have less technical advantages than Tier 1 companies. If they are the first link in the supply chain, they start the ball rolling for the OEM’s final product, which means they really are vital to the speed of production. Tier 2 companies also must be rigorous in safety and standards compliance, because if something isn’t right, then it cannot go on to Tier 1.
What Is Tier 1?
Typically, Tier 1 companies offer the most advanced processes in the supply chain. This is the final step before the product reaches the OEM who may complete the product or simply get it ready for distribution by organizing shipment, marketing the products, or whatever is needed to get the product to the end user.
A Tier 1 company eliminates the middleman for the OEM. Such companies have the strongest credibility with the OEM, as they companies must have proven themselves to be a company that can generate reliable components on time and with strict adherence to safety and standards procedures.
An OEM may have many more tiers than this, but the relationship between Tier 1 and Tier 2 companies shows how all of them operate – Tier 2 generates and supplies Tier 1 with the products it needs to generate and supply the OEM with what is needed for the final products. The supply chain is only as strong as its weakest company link, so having healthy business practices is important for every tier to keep in operation.
_______________________________________
What are TWO-TIER CITIES?
In ONE WORLD ONE GOVERNANCE FOREIGN ECONOMIC ZONE structures we will see only global corporations as multi-national deemed FIRST TIER---OR TOP TIER-----and SECOND TIER-----in supplier and producer chain.
Here we see East India installing these same policies as too in US FOREIGN ECONOMIC ZONES.
We spoke the corruption of last century's economic terms like STEADY STATE and INFLATIONARY when neo-liberalism was installed. This week we want to shout out how terms like TIER 1 AND TIER 2 which have always indicated THE BEST of whatever measure-----TIER 1 SPORTS TEAMS are the BEST------TIER 1 AND 2 HEALTH INSURANCE PLANS are the BEST-------below we see a measure of cities called TIER 1 AND 2. None of this has anything to do with TIER 1 AND TIER 2 GLOBAL PRODUCERS AND SUPPLY CHAINS ----
Regarding STOCKS------derivatives have TRANCHES called TIER 1 AND LOWER------which make winners of stock owners in that highest tranche.
Remember, there is no US WALL STREET or US FED in MOVING FORWARD-----so, being stock holders in FOREIGN CORPORATIONS will soon be the only choice----and private stocks for corporate executives and boards will be those shareholders.
Today's US CORPORATE TAX REFORM reflects these changes -----
'Two-Tier Boards in Indian Corporations? An analysis ...
corporatelawreporter.com/2014/03/10/two-tier-boards...
However, with India opening up its borders to most multinational conglomerates, there could be a presumption that, over time, the Indian corporate scenario may witness a higher number of widely held corporations. Introduction of two-tier boards as an option for widely held companies could align regulatory foresight to this flux'.
Defining tiers is very subjective, as everybody will have qualifications as to what make a city an attractive global center. My rankings are primarily based on current state of the city and future outlook.
Tier I:
Chicago (One of the largest commodities trading hubs in the world)
New York (Global finance/equity hub)
Tier II:
Los Angeles (Really a Tier 1.5 in my opinion. The city has one of the most diverse economies in the world, but high cost of living and increased poverty rates are starting to take a toll on the city’s future potential with international investments)
Washington DC (Capital of most politically active country in the world)
Boston (Undisputed higher education hub in the world. It will take a long time for another city to catch up. Also huge finance center.)
Tier III:
San Francisco (Once the undisputed innovation hub in the world, exorbitantly high cost of living, along with global tech startups like Tel Aviv, Seattle, Shenzhen, Incheon, are starting to raise questions about the future growth potential at SF. High poverty too, though not at the level of LA.)
Miami (Underrated, IMO. Many Latin American companies are setting exchanges in South Florida to escape instability back home. Miami is likely the largest financial center in the Southern USA too, along with Charlotte.)
Seattle
Philadelphia
Dallas
Houston
_________________________________________________
Cities are deemed TIER 1 or TIER 2 by population density-----by tourism------by kinds/size of industry. The United Nations/World Bank claim TIER 1 AND TIER 2 cities are tied to GREEN CORPORATE SUSTAINABILITY--------
The point we are making is this: national FAKE NEWS media and global corporations are deliberately CORRUPTING and CONFUSING these terms. What is TIER 1 AND TIER 2 can KILL 99% OF WE THE PEOPLE or it can be SOCIAL BENEFIT.
MOVING FORWARD ONE WORLD for only the global 1%-----has no SOCIAL BENEFIT----so talk of TIER 1 AND TIER TWO cities will never end well for the general population. We discuss often how UN and World Bank/World Health Organization have their eyes on mass depopulation and FINAL SOLUTION DEEP DEEP REALLY DEEP STATE---so, no social benefit tied to label of TIER 1 AND TIER 2 ranking of cities.
Below we see reference to PRODUCER/SUPPLIER CHAIN which is designated TIER 1 AND TIER 2. TIER 1 refers to PRODUCERS----TIER 2 refers to SUPPLIERS.
We ask our 99% of WE THE PEOPLE----think of this. Last century all US corporations went overseas to Asian FOREIGN ECONOMIC ZONES where producers and suppliers were HALF-A-WORLD AWAY. Shipping all that mass consumption product around the world WAS NOT SUSTAINABLE ---WAS NOT GREEN. What is ONE WORLD ONE GOVERNANCE creating with these SUSTAINABLE PRODUCER SUPPLIER CHAINS? The exact same thing except they are FLIPPING from manufacturing being located in Asia to manufacturing located in Western hemisphere---US/Canada/Latin America/Western Europe/Africa. EXPORT ONLY MANUFACTURING of products to be shipped to EASTERN HEMISPHERE.
MNCs ---multi-national corporations are no longer US OR AMERICAN------what is TIER 1 AND TIER 2 producer supplier being built in US FOREIGN ECONOMIC ZONES?
DARK AGES EAST INDIA CORPORATION------COLONIALISM
MNCs eye tier-2 cities for engg R&D centres
Sangeetha Chengappa
Bengaluru | Updated on March 18, 2019 Published on March 18, 2019
Low attrition rates, growing ecosystem of tech start-ups and support from State governments are also factors that attract MNCs to tier-2 cities
Talent availability, cost arbitrage are main attractions
Global in-house centres (GICs) of multinational corporations in India are looking beyond the top six cities to tier-2 locations to expand their engineering R&D operations.
Cities such as Ahmedabad, Vadodara, Coimbatore, Kolkata, Chandigarh, Thiruvanantha-puram, Kochi and Visakhapatnam are the new favourites.
Attractive features
Increasing availability of talent, cost arbitrage, low attrition rates, growing ecosystem of tech start-ups and support from State governments are factors that have contributed to making these tier-2 cities attractive to GICs.
Automation Anywhere, one of the top five global leaders in RPA (robotic process automation) for enterprises, which has engineering R&D centres in San Jose, Bengaluru and Vadodara, is expanding its presence in Vadodara.
“Our Vadodara centre is very important. We have teams involved in product engineering and innovation, customer success and global field support in the centre. Since Vadodara is a big university town, we are able to attract some of the best talent to work with us. Talent from the centre is currently being deployed across 15 locations globally, including the US, Australia, Singapore, West Asia, Japan, France and the UK, and we will continue to expand our operations here,” Milan Sheth, Executive Vice-President - IMEA, Automation Anywhere told BusinessLine.
Until 2018, all on-boarding of the company’s new employees was done out of Vadodara, which houses 400 of the company’s 1,000-strong R&D talent in India.
Nissan centre in KeralaNissan Motor Company Ltd signed an MoU with the Kerala government to set up its first global centre for digital operations last year in Thiruvanthapuram, which now has a team of 500 engineers. The company already has a global alliance R&D centre in Chennai, which employs 7,000 engineers, who are working on projects, including vehicle and technology development.
As per estimates by global management consulting firm Zinnov, there are 976 multinational corporations which have set up 1,257 GICs in India, of which 68 GICs are in tier-2 locations. Vadodara (29 per cent) and Ahmedabad (20 per cent) together account for 49 per cent of installed GIC talent in tier-2 cities. Bengaluru continues to command pole position for engineering R&D GICs with 469 centres followed by NCR (181), Pune (172), Hyderabad (153), Mumbai (125) and Chennai (117).
Vadodara is key city
Pointing out that Vadodara has emerged as a key tier-2 city for MNCs to establish R&D centres in verticals such as Industrial, Chemicals, Software & Internet, Anand Subramaniam, Associate Director, Zinnov said, “Automation Anywhere has its largest ER&D centre, global water technology firm Xylem, which is building innovative technology-first products for clean water and smart cities, and Solvay, which is working on developing new speciality chemicals for various industries, are all located in Vadodara.”
“Kolkata is shedding its image of a non-starter, attracting R&D centres in the software vertical. For instance, Lexmark is working on embedded solutions in printing and imaging products for its global clients and Hyland is building new age enterprise content management/process management suites. Coimbatore is gaining prominence in Tier 2 cities for multiple industry verticals due to low cost of operations and increased ease of doing business. Mobius which provides professional services for e-commerce, travel, real estate clients and Cameron which works on engineering design for oil & gas, energy industries are located in Coimbatore,” Anand added.
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Yet another measure of TIER 1 AND TIER 2 CITIES is the 24/7 operations of business infrastructure. In FOREIGN ECONOMIC ZONES overseas global factories and campuses were operating 24/7------global phone centers et al operating 24/7-----so, when we hear in Baltimore the city needs more 24/7 business structure----that is what it means.
Here we POPULATION DENSITY as a measure of TIER 1 AND TIER 2 CITIES. The goal of global banking 1% is to push almost all of the world's population into these mega-cities deemed SMART CITIES ---deemed TIER 1 AND TIER 2 CITIES.
'by 2050 some 70% of a projected population of nine billion will reside in cities and their suburbs. Hence, city dwellers will increase from 3.5 billion to 6.3 billion, an 80% rise in urban population'.
So, since this is the ABSOLUTELY WORST structure for economic and development strategies in WORLD HISTORY, global banking creates FAKE NEWS FAKE DATA and far-right wing global banking TALKING POINTS pretending to be left social benefit------selling these massive structures as GREEN AND ENVIRONMENTAL----as populist and full of democracy and freedom------when of course these high-density SMART CITIES will be STANFORD TOTAL PRISON MODEL ---------where everyone is 'HIT' -----SURVEILLED everywhere 24/7 ----inside residential and outside public-----you know, just like ME AND MY CASE of being HIT inside my living space.
'Hong Kong introduces two tiered profits tax rate marking a push towards a more competitive tax environment
3 January 2018
Hong Kong Tax Alert - Issue 1, January 2018'
So, we will now bring the discussion of TAX PUBLIC POLICY tied to terms like TIER 1 AND TIER 2 cities to TAXES----below we see HONG KONG---raging global neo-liberal city in a massive MARXIST CHINA.
Notice this article uses TWO TIERED PROFITS TAX RATE.......which without coincidence is where US CONGRESS and TRUMP are taking US CORPORATE TAX REFORM.
America’s Top Tier Cities: How Real Estate Investment Seeks Urban Quality in its Choices
February 27, 2017/in Academics, Board of Regents /by REALTOR® University
This article was written by Hugh F. Kelly, PhD, CRE.
He is the author of 24-Hour Cities: Real Investment Performance, Not Just Promises and a current member of the REALTOR® University Board of Regents.
The world stands at an extraordinary point. For the first time in the history of humankind, the majority of people live in urban areas. That’s 3.5 billion of the seven billion population of the planet. Even more exceptional, by 2050 some 70% of a projected population of nine billion will reside in cities and their suburbs. Hence, city dwellers will increase from 3.5 billion to 6.3 billion, an 80% rise in urban population. That’s a huge challenge, but it is also a great opportunity for development and investment around the world.
During the past two centuries, the United States has led the way in using migration and immigration to create great cities. At the beginning of the 20th century, America’s population was still largely rural despite the advances of the industrial revolution in employing workers in plants and factories that centered on the cities of the Northeastern quadrant of the country. Cities such as New York, Boston, Washington, Miami…. and even West Coast centers like Los Angeles and San Francisco…. fell prey to violence and civil disorder in the Sixties, Seventies, and into the Eighties. Some places still struggle: Detroit, St. Louis, Cleveland, Birmingham among them. But evidence has accumulated that we are in a new and favorable era for urban America.
Research has been accumulating that indicates several observable urban characteristics which combine to indicate successful cities. This research began with the investigations that led to the publication of my book, 24-Hour Cities: Real Investment Performance, Not Just Promises (Routledge, 2016). Studies have continued in collaboration with Dr. Emil Malizia of the University of North Carolina/Chapel Hill, who independently pursued the topic of “vibrant cities” from an urban planning perspective. Our studies are examining a taxonomy of American cities, a grouping together of cities with common characteristics that point toward economic and social success, characteristics that have supported superior real estate investment performance over nearly three decades now.
Those attributes include diurnal activity (measured by the number of drugstores in 24/7 operation), population density (more than 9,000 per square mile), low crime (fewer than 5,000 FBI Index Crimes per 100,000 residents), transportation (a minimum 10% of the workforce using public transit), live/work proximity (at least 30% of workers living within one mile of downtown), and high Walk Scores. Cities that rank at the top of four of the six criteria are Tier One cities, and are popularly termed “24-hour cities.” Those that meet three of the criteria are clustered as Tier Two cities, matching a grouping termed “18-hour cities” in the industry survey Emerging Trends in Real Estate.
Studying 42 cities in detail, we find six Tier One cities at present:
New York, Chicago, San Francisco, Philadelphia, Boston, and Washington DC.
Eight cities qualify as Tier Two:
Seattle, Los Angeles, Oakland, Portland OR, Baltimore, Pittsburgh, Minneapolis, Austin, and Miami.
Tier One cities have demonstrably produced superior investment returns, as measured by the NCREIF Property Index (NCREIF is the National Council for Real Estate Investment Fiduciaries) for office assets, and this has made such cities magnets of investment capital. Since 1987, Tier One cities have seen their office markets grow from a 16.3% share of total NCREIF investment in 1987 to a 20.1% share, or $101.4 billion as of mid-2016. Tier Two cities have held a fairly steady share of the NCREIF total, at 6.8% in 1987 to 7.2% ($36.5 billion) in 2016. Tier Three (the other 28 cities) have seen their share fall from 13.3% in 1987 to just 6.6% ($33.5 billion) in 2016.
Apartment investment is more evenly distributed as of 2016, but the trends for the three tiers are distinct. The institutional investors comprising NCREIF’s data contributing membership were late in coming to the multifamily sector, but have been making up for lost time in the past two decades. Tier One apartment markets accounted for just 2.0% of the NCREIF portfolio in 1997, but this jumped to 7.4% ($37.2 billion) in 2016. Tier Two multifamily markets represented 2.1% of total in 1997 and 5.5% ($27.9 billion) in 2016. Tier Three apartment assets stood at 7.1% of total in 1997, and were just slightly higher at 7.8% ($39.2 billion) in 2016.
The increasing share of total investment being captured by Tier One and Tier Two markets arguable forms a potential virtuous circle for 24-hour and 18-hour cities. Their status as capital magnets not only provides superior property appreciation, but it encourages continued investment in the assets in the form of CapEx (capital expenditures) to keep the assets competitive and attractive to businesses and to workers. It also provides municipalities with a strong and durable commercial real estate tax base. If such cities wisely reinvest those taxes in high quality public services and amenities, that further attracts high quality workers and the firms that can put those workers to the most productive use.
This is not to say that top tier cities cannot have problems. I would argue that such cities turn problems to advantage. Problem-free cities are not forced to innovate. Innovation comes from problem solving. More is still to be learned. But as the U.S. grows through 2050, so will its cities. And America’s ability to craft ever more attractive live-work-play environments in its cities is one way in which our nation can lead in an increasingly urbanized world.
____________________________________________
Hong Kong is simply installing ONE WORLD ONE GOVERNANCE FOREIGN ECONOMIC ZONE policies tied to global corporations identified as PRODUCERS AND SUPPLIERS. There will be no small and regional businesses deemed TIER 1 OR TIER 2. The tax structure being installed here in HONG KONG as by US Congress and Trump is one where TIER 1 AND TIER 2 global corporations pay NO TAXES----or VERY LITTLE TAXES---while small and regional businesses pay GREAT BIG TAXES. The big LOSERS are the CONSUMERS at the bottom of this CHAIN----those would be our 99% of WE THE PEOPLE.
We have discussed the VAT TAX--------this is simply a variation of this VAT TAX structure.
Notice how HONG KONG global 1% sell this idea of CORPORATE TAX REFORM to small and regional businesses as GOOD FOR THEM.
'KPMG observations
As global tax rates continue to fall, Hong Kong has to introduce new tax measures in order to remain competitive and attract foreign investment into Hong Kong.
The Profits Tax bill is a welcome enhancement to small and medium enterprises in Hong Kong and to the Hong Kong tax system to maintain its position as Asia’s leading international business centre.The Profits Tax bill will be formally introduced into the Legislative Council on 10 January 2018. The IRO will be amended in order to introduce the two-tiered profits tax rate regime. KPMG will provide further commentary and insights upon the release of such amendment to the IRO.
For more information and assistance, please contact your usual tax advisor or one of our tax advisors'.
Please Google to see charts ----
The United States’ Corporate Income Tax Rate is Now More in Line with Those Levied by Other Major Nations
February 12, 2018
Kyle Pomerleau
The Tax Cuts and Jobs Act (TCJA) reduced the U.S. federal corporate income tax rate from 35 percent to 21 percent. However, corporations operating in the United States face another layer of corporate income tax levied by states. As such, the statutory corporate income tax rate in the United States, including an average of state corporate income taxes, is 25.7 percent. This rate puts the United States in line with the average among Organisation for Economic Co-operation and Development (OECD) member nations.
In addition to the 21 percent federal corporate income tax rate, 44 of the 50 U.S. states levy corporate income taxes. State corporate tax rates range from 3 percent in North Carolina to 12 percent in Iowa. The average state corporate income tax rate (weighted by population) is 6 percent. (See Table 1, below)
Under current law, state and local income taxes are fully deductible for corporations. As such, the effective statutory tax rate for each state is lower than the “headline” tax rate. Four states (Alabama, Iowa, Louisiana, and Missouri) also allow corporations to deduct some portion of their federal tax liability against their state liability, reducing the effective statutory rate even further.
Combined with the federal rate of 21 percent, corporations face marginal rates from 21 percent in states with no corporate income tax to as high as 29.6 percent in Iowa, where the corporate tax rate is 12 percent. The weighted average (by population) combined corporate income tax rate in the United States under current law is 25.7 percent.
Before the TCJA passed, the United States had the highest combined statutory corporate income tax rate among the OECD nations at 38.9 percent (35 percent plus the average of state corporate income tax rates). This was approximately 15 percentage points higher than the OECD average, excluding the United States at 23.8 percent (26.5 percent weighted by GDP). (Figure 1)
After the passage of TCJA, the U.S. combined rate dropped from 38.9 percent to 25.7 percent. This puts the United States slightly above the OECD average of 24 percent, but slightly below the average weighted by GDP.
The TCJA significantly reduced the federal statutory corporate income tax rate. When combined with state and local taxes, it put the U.S.’s corporate tax rate in line with the average among OECD nations.
_________________________________________
When discussing global corporations in FOREIGN ECONOMIC ZONES and the goals of ONE WORLD ONE GLOBAL TIER 1 AND TIER 2 producer supplier chain-----please remember yet another confusing set of terms. Where TIER 2 SUPPLIERS will be global corporations------this category is divided into many other TIERS----all of which are called SUBCONTRACTORS. SUBCONTRACTORS are those small and regional businesses being told all this VAT TAX structure MOVING FORWARD is GOOD FOR THEM.
TIER 2 SUPPLIER GLOBAL CORPORATIONS will have a long list of tiers tied to being subcontractors to top supplier global corporations.
'A Tier 1 company eliminates the middleman for the OEM'.
'Difference Between Tier 1 & Tier 2 Companies
by Olivia Durden; Reviewed by Michelle Seidel, B.Sc., LL.B., MBA; Updated January 31, 2019
Difference Between Tier 1 & Tier 2 Companies'
Could a two tier VAT system save the high street?
13th Sep 2018
27
The high street’s troubles are well documented at this point. Stores have closed, jobs have been lost and businesses have gone bust, the decline seems terminal. But according to one group, a two-tier tax system could stop the bleeding.
Colliers International, one of the UK's largest property consultancies wants a two tier VAT system. Under the proposal, shoppers would pay tax at 15% in a brick-and-mortar store and 22.5 % for online purchases.
The suggestion isn’t entirely from left field. The chancellor Philip Hammond recently told Sky News he’s considering a special retail tax - dubbed an ‘Amazon tax’ - on online retailers.
"We want to ensure that taxation is fair between businesses doing business the traditional way and those doing business online," he said in the Sky News interview. "That requires us to renegotiate international tax treaties because many of the big online businesses are international companies.”
Adapting the VAT system could be a powerful vehicle to achieve this, according to Paul Souber, Colliers’ head of London retail. It would present a strong incentive for shoppers to return to the high street and online retailers to lease physical stores.
But Souber and Colliers’ plan isn’t as simple as it sounds, according to David Wilson and Andrew Hubbard of RSM. “Artificial distinctions to address a particular policy agenda generally don’t work,” they wrote.
“The very ethos of VAT is that it is charged on the ‘value added’ at each stage of the production and distribution process, including retail sale, and affords businesses in the supply chain the right to deduct the VAT paid at an earlier stage of that process from the VAT payable on the onward supply.”
VAT is structured, ultimately, to be paid by the end consumer. “If a higher VAT rate applies to online retail sales than to sales by high street retailers then, rather than levelling the playing field between the two, the additional VAT burden would result in increased costs for the consumer.
“As VAT would not appear to be either a legally competent or administratively practicable means of levelling the playing field between the high street and online retailers, and as it's highly unlikely that the Chancellor will interfere with the business rates regime, the focus will once again fall on taxing the value generated by online businesses.
“Whether that will take the form of an online sales tax should become clear on Budget day.”
As we’ve covered on AccountingWEB before, simply blaming online retail for the high street’s woes is simplistic. Inertia and a failure to address the drag of legacy real estate has created its share of the trouble, too. To paraphrase, the retail analyst Richard Hyman: an ‘Amazon Tax’ might dull the pain - but will it create better retailers?
_______________________________________
BUT BILL GATES supports these US CORPORATE TAX REFORMS tied to installing VAT globally---and BILL IS THAT GOOD BILLIONAIRE remember-----he cares about our US 99% of WE THE PEOPLE ----wait, he is DEEP, DEEP REALLY DEEP STATE----we are sure BILL only cares about BILL.
PROGRESSIVE used here is FAR-RIGHT WING GLOBAL BANKING 1% ECONOMIC PROGRESSIVE---NEO-LIBERAL consumption tax-----the opposite of REAL left social progressive FDR broad-based tax contribution from corporations and the rich.
Mar 18, 2014, 01:14pm
Bill Gates Points To The Best Tax System, The Progressive Consumption Tax
Tim Worstall
Contributor
I think tax structures will have to move away from taxing payroll. … Technology in general will make capital more attractive than labor over time. Software substitution — whether it’s for drivers or waiters, nurses … it’s progressing. And that’s going to force us to rethink how these tax structures work in order to maximize employment given that capitalism in general over time will create more inequality, and technology over time will reduce demand for jobs, particularly at the lower end of the skill set. We have to adjust, and these things are coming fast. Twenty years from now, labor demand for lots of skill sets will be substantially lower, and I don’t think people have that in their mental model. … Economists would have said a progressive consumption tax is a better construct at any point in history. But what I am saying is that it’s even more important as we go forward because … I want to distort in the favor of labor. …When people say we should raise the minimum wage — I know some economists disagree — but I worry about what that does to job creation. The idea that through the Earned Income Tax Credit you would end up with a certain minimum wage that you would receive, that I understand better than intentionally dampening demand in the part of the labor spectrum that I’m most worried about.
There's two parts to why such a progressive consumption tax is regarded so highly by economists. The first part speaks to efficiency, the second to equity.
To deal with the second idea first: despite many thinking that economists are simply the handmaidens of the oppressor class of the 1% "what's fair?" is a question that is asked rather a lot in the halls of academe. And the general answer is that fairness in a taxation system requires that those with the greatest capacity to pay should pay more tax than those with a lesser capacity to pay. This is accepted by pretty much everyone: that average tax rates should rise with income. Sure, some to many go on and insist that the rich should pay much more than this, face rising marginal rates perhaps, but the original contention is supported by pretty much everyone. And that's where the "progressive" part comes in. It doesn't mean that there has to be a number of different tax rates: that would be insisting that there must be higher marginal rates. All you need to have rising average tax rates is that there is a flat tax with some non-taxable allowance at the bottom of it.
Just as a constructed illustration of this, take a tax system with a 10% rate on all income over $10,000 a year, the first $10,000 being tax free. If you make $10,00, your tax rate is 0%. If you make $20,000 then your tax bill is $1,000 ($20k - $10k x 10%) or 5% and if $100,000 then your tax bill is $9,000 ($100k-$10k x 10%) or 9%. We have rising average tax rates even if we don't have a rising marginal one. Indeed, the average tax rate will asymptotically approach the flat tax rate itself as income rises. As above, you can also have rising marginal rates or tax bands if you desire, but this flat tax with an allowance is indeed enough to meet the condition of it being a progressive tax system.
The second part is about efficiency, which is that part that means that we tax consumption. Here the concern is about deadweight costs. All and any tax, by being levied, means that some economic activity doesn't happen. But we do need to raise some taxes, somewhere, for we do rather need this thing called government and we've got to pay for it. Maybe we don't need as much as we have, perhaps we need more, but the basic fact that there have to be taxes of some kind remains. We would obviously therefore prefer to raise the tax money we need by using the taxes that have the least deadweight costs. All other things being equal we'll be richer by doing it this way rather than using taxes which destroy more economic activity for the same amount of revenue collected.
We know which taxes destroy the least economic activity as well. Repeated taxes on real property can actually create more economic activity in certain circumstances. Then more costly are consumption taxes, more costly again are taxes upon incomes and then most costly are capital and corporate taxes. Transactions taxes like the financial transactions tax are so ludicrously expensive in this sense that we don't usually include them in our list: but they're way up at the top there, even more damaging than capital or corporate taxes.
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