President Obama’s first — and hopefully only — term as President of the United States is now ¼ over, and it was punctuated by yesterday’s upset victory by state Senator Scott Brown in the special election for the United States Senate seat formerly held by Edward Kennedy. The voters of Massachusetts elected Mr Brown for many reasons, but at least some of them to voice — and vote — their displeasure with Barack Obama and his performance as our 44th President.
But, in honor of our President having completed his first year in office, I’ll mention something good that he’s doing, something I can easily support:
Obama Cracking Down on Contractor Tax Cheats
WASHINGTON (AP) — President Barack Obama on Wednesday ordered a new crackdown on federal contractors who don’t pay their taxes.
Obama signed an executive order telling federal agency chiefs to take steps to bar those companies from receiving new government contracts. The order also directed the IRS to review contractor filings to make sure companies are not lying about the taxes they’ve paid.
Obama said the practice is inefficient, wasteful and, above all, wrong.
”It is simply wrong for companies to take taxpayer dollars and not be taxpayers themselves,” Obama said. ”We need to insist on the same sense of responsibility in Washington that so many of you strive to uphold in your own lives, in your own families and in your own businesses.”
The White House said the move is part of the president’s effort to restructure government contracting to eliminate waste and abuse.
More at the link.
I watched part of the President’s speech, and he noted that one contractor, who owes more than a million dollars in back taxes, recently received a million dollar payment for some contract. The contractor didn’t use the money to pay his back taxes, but to buy a luxury home (or so the resident said.)
It’s always possible to foul up on the details of how such things can be handled, but if you owe the government back taxes, and you are due a refund the subsequent year, the government will deduct what you owe from the refund check. As long as due process of law is followed, I see no reason why a contractor who owes back taxes, and who is also owed a payment from the government, should not have those back taxes deducted before the payment is made. And I have no problem at all with refusing to grant new contracts to companies or individuals who owe back taxes and don’t straighten that out.
It always seemed odd to me that government workers had to pay taxes. Wouldn’t it be easy enough to precalculate salary at the time of hiring and just pay the person less? The same should be true of contractors.
Nang: You’d need different accounting rules, because some government employees have second, non-government jobs, and some government workers are married to people with non-government jobs. But, on the whole, it’s the right idea. As far as companies are concerned, it could be that a federal contractor owed taxes from a non-public sector job.
The people who would complain the most are state lawmakers, given that most of them tax income as well.
Government contracts are a huge area of waste in the budget. Not just the tax cheats but the straight-up cheats – I don’t think there’s a single defense contractor out there that hasn’t been investigated for defrauding the government in at least one instance, and I’d be surprised if that sort of fraud were limited to defense contracts.
what about the people working for the contractor that wouldn’t get paid b/c of your plan?
donviti:
what about the people working for the contractor that wouldn’t get paid b/c of your plan?
There’s a law that is called the Prompt Payment Act where the contractor certifies they paid all their bills for which they are asking payment.
“But, on the whole, it’s the right idea.”
Hold on there big fella. The appearance and therefore over time, the thinking would become that the govmint employees aren’t paying taxes. And you know what? They wouldn’t be! Perception would become reality. All Americans need to see and feel the pinch of taxes so they are aware of who they voted for and what is being spent. Also, the perception would be one of “net” income. That’s why I hate witholding tax. Most employees just don’t realize how much they are paying in taxes, they just look at the Net. If they had to write the monthly checks I write they’d crap themselves. Just last week I deposited my 941 for December to the tune of $17,600. That’s their (and my) money!
Taxes should be collected as painfully as possible so we remember to keep them as low as we can.
Mr Viti asked:
Well, it’s President Obama’s plan, not mine, but I certainly approve. And, depending on the type of contract, there may be a performance bond involved, and if done properly, the employees might have recourse to payment through the performance bond.
Dana Pico, we cannot have employees running around executing performance bonds, going to court and suing employer and the government itself to collect their pay while their employers abscond with the money they failed to pay in taxes.
A lot of employees, perhaps even most, live paycheck to paycheck and cannot afford to go without for weeks while they fight for what is justly owed to them.
Simply put, net tax payments to contractors will cause undetermined hurt to employees while allowing the employers to tie up action in court and/or remove the money off shore.
The rule should just be that a company must be in good standing with their taxes or they can’t even bid on a contract. Hell, I have to be in compliance with my taxes to get a loan or a mortgage (or even a building or zoning permit). Why not a government contract? The only way this can happen is because the bureauweenies allow it to happen.
Just last week I deposited my 941 for December to the tune of $17,600. That’s their (and my) money!
If you believe the tax is your money, then you better give up on your American citizenship. You’re not willing to pay for it, after all.
The Philistine in a time of Israelites wrote:
This, it seems to me, is the fundamental difference between liberals and conservatives. For our favorite New Zealander, all money is the government’s. But to conservatives, the money belongs to the people.
This was the same kind of attitude which has allowed Martha Coakley to complete her term as Massachusetts’ state Attorney General: she and her minions thought that it was “Ted Kennedy’s seat,” while Scott Brown hammered home that it’s the people’s seat.
It should be noted here that, when the people are asked, either indirectly in voting for candidates who run on higher or lower taxes, or directly, when it comes to voting on tax measures — Proposition 1A-E in California would be the most famous recent example — the people usually vote for lower rather than higher taxes.
Phoe, perhaps if you actually read Form 941, you’d note that it is the form in which the employer tells the Infernal Revenue Service how much money was withheld from John’s employees’ checks, for Federal income tax, Social Security and Medicare taxes. John has to include what he paid himself, of course, but most of the amounts listed are what was withheld from employees’ paychecks, and what is credited to their taxes, not his.
So now Pho is a professor of American Citizenship?
Pho, I believe the money was earned by my employees, not the government. I also believe I had to deduct it from their pay, hold it in an account, pay my accountant to do the paperwork for it, open a special bank account for the government in which to deposit it and then write the check.
I’ve never said, EVER, that we don’t have an obligation to pay taxes.
I’ve already “paid” for my citizenship, in blood. How bout you?
This, it seems to me, is the fundamental difference between liberals and conservatives. For our favorite New Zealander, all money is the government’s.
Incorrect. I said “the tax”, not “all money”. Do you see the difference, Dana – “the tax” not “all money”. Would you like me to spell it out for you in more detail? Do you need a dictionary, Dana?
I assume that you would also complain and whine about paying rent because the rent is “your money”? You earned it; it is theft that someone forces you to pay it to them merely because you live in their house. Hopw terrible! What ever happened to your rights?
Taxes are what you pay as part of belonging to a nation. It is no more “your money” than the rent cheque you psy is “your money”. You “earned your money” while taking advantage of living in a functional society, one which protects you, issues and regulates currency, gives you a monetary system in which to pay and be paid, gives you legal recourse to support contracts. Without those things, you have no more right to “earn your money” than you have a right to breath air in the vacuum of space.
You can live without taxes. It is simple. Simply move to Somalia.
But you see, Phoe, I don’t pay rent: I live in the house I bought!
I don’t know how Kiwis think, but I do know that the American taxpayer tends to regard taxpayer dollars as our money, not the government’s. You may find that a strange distinction, but it is one we take. Even Perry would confirm that one for you.
The Phoenician wrote:
Again, a completely different concept. Americans think of the government as belonging to us, not we belonging to the government. Our Declaration of Independence enshrined that idea, when we declared that if we found a particular allegiance to be intolerable, we had the right to sever it, and if we found a particular government unsatisfactory, we had the right to abolish it:
Note that, to Americans governments are the creation of the citizens, and operate only upon the consent of the governed. The government does not own us. We take these distinctions rather seriously.
But you see, Phoe, I don’t pay rent: I live in the house I bought!
You seem to be having more than the usual reading problems today, Dana. Read the words “you would also” again – does the word “hypothetical” mean anything to you, or do you need a dictionary again?
I don’t know how Kiwis think, but I do know that the American taxpayer tends to regard taxpayer dollars as our money, not the government’s.
Indeed – Republican propaganda has been good at pushing this over the last few decades. Of course, it always winds up with corporations and the elite paying less and less of their share of the tax burden while the middle class and poor pay more and more. So well done on parrotting the idea like a good little dupe.
Republican propaganda has also pushed the idea that you can do things such as starting wars, invading other countries, or giving contracts to Halliburton and Blackwater without ever having to pay for it.
How’s that working out for you?
By the way – feel free to explain to your daughter that she should be giving her pay cheque entirely to you, as it’s your money…
Sorry,Pho but Americans tend to believe what they earn and what they own belongs to them not the government or for that matter anyone else. That does not mean we don’t understand our civic obligation to support our country. I just means we hold our country responsible for spending our money WISELY, as it is OUR MONEY.
That’s why the vast majority of lefists in this country pay little or no taxes. They have no vested interest in spending MY money wisely.
The “corporations” are in bed with government regardless of who Is the government. Happens, right now they are in bed with Democrats. We are talking about regular people not the CEO’s of GM, Chrysler, AIG etc. They are firmly on the side of the Democrats as it is they who pay their salary. Let’s see, the Dems took control of the mortgage companies, the banks, the auto makers and now want to control the insurance companies and the energy producers. And you blame the Republicans for this crap?
“Of course, it always winds up with corporations and the elite paying less and less of their share of the tax burden while the middle class and poor pay more and more.”
That entire statement is a blatent lie. We have one of the highest corporate tax rates around; the “elite” as you call them pay the lions share of income tax; the middle class pays the rest of the taxes which are substantially less than the “elites” even though there are millions more of them; and the poor pay zero. Matter of fact they get “refunds” for money they never paid to begin with. What are you smokin’ or do you just throw crap out there?
“Of course, it always winds up with corporations and the elite paying less and less of their share of the tax burden while the middle class and poor pay more and more.”
That entire statement is a blatent lie.
Uh-huh:
Idiot.
It doesn’t matter if corporations pay a larger or smaller amount of taxes, because corporations don’t pay taxes at all. Instead, corporations simply collect taxes from their customers, and, in the end, all taxes are paid by the end user of a given product.
What the corporate tax does is to conceal from people just how much they are paying in taxes.
I’m not talking the 1950′s. Nor the 40′s, nor 60′s. I’m talking TODAY as compared to many other countries. Corporate taxes steal money from customers and shareholders and persons who invest for their retirement in said corporation. So don’t tyell me about corporate taxes, I pay them every time I buy a corporate product. Lean economics, stop being a parrot for the communists.
Speakin’ of tax policies:
By ANDREW TAYLOR, Associated Press Writer Andrew Taylor, Associated Press Writer – Wed Jan 20, 6:39 pm ET
WASHINGTON – Senate Democrats on Wednesday proposed allowing the federal government to borrow an additional $1.9 trillion to pay its bills, a record increase that would permit the national debt to reach $14.3 trillion.
Which leads into:
Russia diversifies into Canadian dollars
By Peter Garnham
Published: January 20 2010 16:46 | Last updated: January 20 2010 16:46
Russia’s central bank announced on Wednesday that it had started buying Canadian dollars and securities in a bid to diversify its foreign exchange reserves.
Analysts said the move could be a sign of increased diversification of emerging market central bank assets away from the [US]dollar and into investments denominated in other commodity-linked currencies, such as the Australian dollar.
If we don’t get rid of these Marxists out soon we will look look Haiti. Wait, maybe if we enact HCR and Cap & Trade we can reverse this trend. Or would that just be plain stupid?
[Released from moderation (12:22am) -- JH]
Pho doesn’t understand what an income tax rate is.
I’m talking TODAY as compared to many other countries.
Given that you were replying to a comment about how shares in taxation had changed in your country over time this suggests you’re functionally illiterate then.
Over the last few decades in the United States, the corporations and the wealthy elite have paid less and less proportionately of taxes, and the middle class and poor have paid more. Deal with it.
Now, please note the words “over the last few decades” and “proportionately”. I realise you have problems understanding simple English, so do let me know if you need help with them.
It doesn’t matter if corporations pay a larger or smaller amount of taxes, because corporations don’t pay taxes at all. Instead, corporations simply collect taxes from their customers, and, in the end, all taxes are paid by the end user of a given product.
Nope. By that “logic”, you can also state that salary and wage earners don’t pay income taxes at all – they merely get paid more by their employers to cover those taxes.
But, of course, what you are arguing (or rather parrotting from propaganda like a good little wingnut) is that corporations should not pay taxes and that burden should be shifted to wage and salary earners. Meaning that shareholders (i.e. the wealthy) get more and the middle class and poor get less…
Let me state it very clearly so Pooter and the liberals can go off into a tizzy: There should be no taxes of any sort on corporations. There, I said it. Have a field day.
Oh, Pooter, do you know who is a shareholder? Anyone who has a 401(k) and anyone who has an IRA and anyone who has any investment in their own retirement. That’s who is a shareholder. That would be the wealthiest 75 percent of the US.
Oh, and union pensions are tied up in stock, as well.
The Phoenician fails Economics 101:
Actually, in some cases they really do: the employers’ share of Social Security and Medicare taxes are actually part of the employees’ compensation; they just don’t see it. If you are self employed, you have to pay not only the 7.65% (6.20% for OASDI, and 1.45% for Medicare) employees’ part, but the 7.65% employers portion. (Source).
It’s really very simple: employers must collect everything they spend, plus extra for profit, on their products, or they fail, go out of business.
Perhaps you believe that, if there were no corporate taxes, businesses would be able to sell their goods for the same amount as with the taxes, and simply take in more profit. Such might be the case with a monopoly, but any business which had competitors would wind up having to lower prices, as one or more of its competitors would, to earn market share.
If you can’t see this where taxes are concerned, I’m sure that you can where labor is: manufacturers of products which do not require local manufacture have moved plants out of the United States to countries with far lower wage costs. They have had to do so to remain competitive with foreign manufacturers. Their costs have come down, as have their prices, because they compete. Since the American — and I’d guess New Zealand — consumers usually take price into consideration, this had to be done. The inclusion of tax costs in final product prices is no different from the inclusion of labor costs.
Well, there’s the problem, Dana. You, having worked in the private sector, have a solid grasp of functional economics. Pho, having never done so (as far as I know), is instead forced to fall back on some theory he probably picked up in college, hence his usual Marxist rants about the “evil” rich …
Pho rants again:
Really, you just don’t understand our politics, our history, or our culture AT ALL. Read Dana and John C, and learn a few things, instead of just knee jerk opposing them.
Pooter doesn’t think he needs to learn anything. He is that fool who believes he already knows everything so he doesn’t have to learn. And, having never stepped foot in the US, he obviously knows everything about the US, its politics, its society, its history..
John Hitchcock:
Pooter doesn’t think he needs to learn anything. He is that fool who believes he already knows everything so he doesn’t have to learn. And, having never stepped foot in the US, he obviously knows everything about the US, its politics, its society, its history..
Come on John, give Pooter a break. Afterall he has Google and Wikipedia, what more does he need to know. Just look it up, apply Kiwi Standards, and off he goes.
So, what sources do you consider credible, York?