The data required for rational economic planning are distributed among individual actors and thus unavoidably exist outside the knowledge of a central authority
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But "a much bigger share of business profits is now earned in those entities". That's where the profits are to tax.
The tax code recognizes that and, by intentional design, it makes the pass-through form more attractive than the double-taxed C-corporation form for many businesses.
Since total receipts (from traditional business AND new forms) are similar, it appears as if you simply want to penalize "corporations". PARTICULARLY, if they're earning a materially diminishing share of total business profits.
"Design institutions that perform tolerably well even when both information is imperfect/dispersed and incentives are misaligned. Emphasize rules over discretion, decentralization (markets, polycentric governance), and skepticism of fine-tuning. Comparative institutional analysis under realistic constraints."
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The form of the code and the way business is structured have both changed. There has been a large increase in pass-through entities: S-corporations, partnerships, LLCs, and similar forms. A much bigger share of business profits is now earned in those entities and taxed on the individual returns of the owners (partners, S-corporation shareholders, and LLC members) rather than on separate corporate returns. When you include those amounts, combined federal tax collections on business income have been relatively stable as a share of GDP since about 1980, typically averaging in the low-to-mid 2% range with normal business-cycle variation.
No "manipulation". No "shelter".
LOL.
Do you really want to know, or do you want to demagogue?
The reasons these companies didn't pay taxes are embedded in the tax code. Not one "evaded" taxes they owed or engaged in felonious behavior.
The tax code mirrors normal accounting practices by matching expenses with revenues when they occur. A primary reason the tax bill for the companies was reduced was the concept of net operating loss (NOL) carry-forwards. Previous years' losses are netted out against current year profits, with taxes due on the difference. This is an historic account principle.
Corporations spend on research and development. Those are expenses they incur in order to generate profits. They can be thought of as similar to the cost-of-goods sold. Similar to COGS, R&D expenses adjust total taxes due.
Similarly, corporations spend on capital goods and equipment. These are also a necessary cost of doing business and can adjust total taxes due.
All of these can, and do, interact in a real corporation with many operating divisions and business lines, producing compounded affects that materially impact their tax basis.
If you really wanna know, how, why, and how much each of the affected any individual company, you can look at the 10-K filings they made with the SEC. It's all there.
Which of these do you want to eliminate? Net-operating loss carry forwards? R&D expensing? Capital and equipment depreciation? Why don't they belong in the tax code?
They've been part of the tax code for a century.
