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Let’s also remember that with a 30% corporate income tax, for example, government functionally owns 30% of all the corporate equity, listed and unlisted, large or small, etc. And if it wants more, for example, it can raise the tax.

This is the ‘direct pipe’ and it can’t be diluted or crammed out.

And government also controls the accounting rules that determine what is taxable and what isn’t, etc. That means the present value of that 30% would be more than of equal to the market cap. of all the corporations combined.

So when government wants more equity for restoring a going concern, it should be aware it already stands to ‘gain’ (reduce aggregate demand, actually) via it’s 30% share.


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6 Responses

  1. “government functionally owns 30% of all the corporate equity,”

    Weird, really? I thought all those offshore boyz in caymans and US virgin islands wasn’t giving their 30% to da gubbment? Who do you know in the USVI giving the gubbment 30% Warren? Most of my joe6pack friends saw their job go bye bye to a foreign country because the big companies are not gonna pay Uncle Sam 30%. They are actively pushing china to establish a moon base so that they can set up offshore NO TAX entities in space, so much for the USVI (snicker)

  2. The chinese moon base offshore tax shelter plans: http://www.astronautix.com/craft/chirbase.htm

    Here was a big scifi’s author vision on the future tax shelter on the moon revolting against the earth tax authorities:

    en.wikipedia.org/wiki/The_Moon_Is_a_Harsh_Mistress

    If Wesley snipes runs to the moon to not pay his taxes, not to easy to send a police man with a gun to make him pay eh? But nukes can hit objects in space so maybe he can’t escape.

  3. the same govt that charges 30% made the rules for the VI, presumably for public purpose, long before I got here.

    and the US govt promoted the program at their conferences, etc.

    i was just doing my patriotic duty by moving here.

    not many others have done same, as most don’t think it’s worth it.

  4. Interesting point. I never thought about it as you have expressed it in your observation but you make a valid point Warren. At the very least the government has a lien on 30%of corporate equity. Now, do you think the wizards running the government could ever grasp the idea? I doubt it.

  5. “the same govt that charges 30% made the rules for the VI, presumably for public purpose, long before I got here. ”

    LOL. True, also to be said of those guys in gaum and the other territories, last I saw some lobbyists and congressmen are going to jail for being corrupt cronies relating to those places – what is the last act of a corrupt government? Looting the treasury right?

    “i was just doing my patriotic duty by moving here.”

    LOL! I love you Warren, me too, I should be moved within a month or 2. I am proud to be an American and do my patriotic duty LOL!

    “not many others have done same, as most don’t think it’s worth it.”

    Yah, not all of us can be millionaires seeking tax shelters like you and me and willie nelson and wesley snipes and the other elites! My first political action when I become a USVI resident is to lobby to get the rules changed so USVI people can elect presidents, I am voting for you, to make sure our collective interests are represented in washington. Mosler for president! I want someone who is going to implement speed limits and crush those idiots in detroit.

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